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Revolutionary Youth & the New Working Class
Toward a Theory of Social Change:
The ‘Port Authority Statement’
By David Gilbert, Robert Gottlieb, and Gerry Tenney
Editor’s note: The was a seminal document written collectively by a
grouping in SDS, centered in New York city and Chicago, often referred
to as the ‘Praxis Axis’. They represented several things: One, a continuing
turn in SDS toward revolutionary Marxism and a further break with the
group’s social-democratic past, as codified in the original ‘Port Huron
Statement.’ Two, they continued as New Leftists, resisting being drawn
back into the old polemics—Stalin, Trotsky, Mao—and instead looked toward other new leftists in Europe, especially French neo-Marxism and
the renewed interest in Gramsci in the Italian left and the German SDS.
Three, they wanted focus on the present realities and new developments of capitalism, trying to project into the future.
This is the first time the full document has seen the light of day
in print. About a third of it was published in SDS’s New Left Notes, in a
disjointed form; but factional struggle prevented the bulk of it from ever
being published.
Some of the original Praxis group went with the Weather Underground, some with RYM2, and others to independent efforts. What is
startling about the 1967 document is how prescient it turned out to be
on many topics. It was affectionately dubbed ‘the Port Authority Statement’ because in was largely written and formulated in a small student
apartment near the Port Authority Bus Terminal in New York City. It was
meant to supersede SDS’s original Port Huron Statement.
Introduction
This paper is an attempt to develop the rudiment of a theory of social
change in America. It will deal with the specifically new and changing aspects of American society without obscuring such structural components
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53
as its capitalist mode and class nature. The analysis will try to be systematic in that certain key structural features will be examined and abstracted
into a schematic model, a model that can be used as a guide to the practical
activity in changing this society (praxis).
American Capitalism
The Economic Order: The Concentration of Wealth
One of the major sources of power in American society is corporate
wealth. This key element of power is all too often either accepted or assumed in a context that does not allow for critical analysis. Corporate
wealth lies at the heart of control and power in American Capitalism.
The primary expression of the concentration of wealth is found in the
huge corporate institutions that dominate American economic life. According to recent government statistics, the five largest corporations account for 13% of all manufacturing assets, the 50 largest have 36% of
the total, the 200 largest have 57%, and the 1000 largest have 76%–out
of a total of 180,000 corporations engaged in manufacturing. The share
of the top 50, 48%; top 200, 68%; and the top 1,000, 86%. About 1% of
all manufacturing corporations account for almost 90% of all net profits,
while the remaining 99% got only 10% of the total. 1
These figures demonstrate the concentration of wealth within corporate
life. The absolute figure of not profit or sales among these corporations–
e.g., the figure for General Motors not profits after taxes in 1965 was $2.1
billion, and its sales $21 billion, which was greater than the GNP of all but
9 countries2–testifies to the strength and wealth of the largest corporations,
not only in inter-corporation comparisons but also in the absolute figures
of profit and sales. Corporate profits as a whole dramatically increased
from 1960 to 1965 from $27 billion in 1960 to $45 billion in 1965. 3
This rise in corporate profits has far exceeded the rise in earnings or
assets of any other group involved in economic production. From 1960
to 1965, corporate profits after taxes rose 66.7%; factory workers weekly take-home pay rose 20.8%.4 The 1965 figures of earnings by different
groups were: 1) industrial workers average hourly wages up 4%; 2) professional workers, up 7.5%; and 3) corporate profits after taxes, up 20%. 5
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Revolutionary Youth & the New Working Class
However, these figures don’t tell the whole story. Published corporate
profits do not take into account the various devices that allow for hidden
profits. These hidden sources of wealth can be roughly broken down into
the following areas. 1) Exorbitant depreciation allowances–this refers to
masking reinvested profits as an expense (tax deductible) for depreciated
capital goods. 2) Income in kind– this refers to the numerous expenditures that are associated with “business expenses”, in reality the personal
luxuries associated with the corporate men of power. 3) Stock options–
this refers to the ways corporate executives avoid declaring their income
in full. The plan essentially entails the availability of stock to executive
below the official price (ca. 85%) and in the form of capital gains which
automatically reduces to 25% the amount of taxation, this capital gains
rate being well below income tax rates for executives.6 This description
by no means exhausts the areas of hidden profits but demonstrates another
source of wealth which leads on to question corporate statistics, which are
incomplete if not misleading.
Who are these huge mega-corporations? In general, they fall and overlap into the key areas of the American economy and its resultant social
production. Since these corporations control the key aspects of the economy, their role becomes even more crucial, given the reliance of peripheral
industries on those corporations (for supply, demand, etc.). Thus, the four
largest corporations in each of the following sectors account for: ca.60%
of all aircraft; 78% of synthetic fibers; 80% of primary copper; ca 50% of
electric appliances, tubes and control apparatus.7 By 1966, the top 3 automotive corporations controlled 95% of all production.8
Within these mega-corporations, a small group of individuals, through
concentration of stock ownership, control the decisions affecting and directing the American economy. First, the general concentration of individual wealth is described by the following: The richest 1.6% of the population own nearly 1/3 of the county’s material assets. 8 Secondly, in the
specifics of stock ownership, ca. 2.1% of common stock share holders
owned ca. 58% of common stock.9
The individuals controlling these various corporations also have extended interests in other corporations through interlocking directorates.
Interlocking directorates fall into the following categories (as defined by
the Federal Trade Commission): 1) between competing firms, 2) between
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companies in related industries 3) between companies in a single industry
facing similar problems, 4) between purchasing company and supplier,
5) between producer and distributor, 6) between corporation and financial institution, 7) between companies with common ownership. 10 The
interlocking directorates not only concentrate power in the hands of a few
individuals, but they also allow for a coordination of corporate interests–
planned corporate capitalism–and facilitate the multidimensional control
exercised by the corporations themselves.
Mulitdimesional Control
Besides interlocking directorates, purchase of one corporation by another creates the groundwork for multi-dimensional control. These purchases involve companies that were, by and large, making profits when
they were acquired. During the period of 1960 to 1962, the top 200 corporations acquired ca. 1900 other companies whose total assets amounted to
nearly 14 billion.11 In 1965, there were 1008 major mergers in the 23 fields
of manufacturing and mining as compared to 219 mergers in 1950.12
Diversification, occurring through corporate purchase, can be found
in the following areas: 1) between competing companies (e.g., Pure Oil
purchased Continental/Union Oil, 2) between indirectly related industries
(Consolidation Coal purchased Continental Oil), 3) through currently unrelated but potentially linked industries (Lipton Tea purchased Good Humor; Xerox purchased Wesleyan U. Press.)12a
The existing anti-trust laws do not include diversification through
non-competing industries purchases. The extension of a corporate power,
especially in light of multi-dimensional control over economic life has not
been modified measurably in any respect by governmental action. Those
corporations, with their small number of controlling directors and managers, shape the lives of the entire society and of each individual subjected to
the interest of corporate power.
The Social Order: The Structure of Communications
The most crucial area of the concentration of power is in the field of
communications–”the passing of ideas, information, and attitudes from
person to person”, 13 (which therefore includes education). Communica-
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tions is one key to power in a stable society, since it is a means through
which ideology is formed and maintained.
While it has long been known that communications in America have
been controlled by a wealthy elite, the moves toward further centralization
in the past few months are truly spectacular. Radio Corporation of America recently merged with (bought) Random House, one of the two or three
top American publishing companies, including its many subsidiaries such
as Knopf, Modern Library, and Bantam. R.C.A. already owned N.B.C.
Television Network, which in turn owned six and has contractual relations with some 300 radios stations. R.C.A. has also bought Hertz RentA-Car. Chairman of the R.C.A. Board, David Sarnoff, received an honorary degree from Columbia University in 1966, an indication that he is an
important contributor to Columbia. Random House has greatly benefited
from government subsidies for text books, as have other big publishers.
(Revenue for textbooks in the U.S. increased by 250% between 1960 and
1966.14) R.C.A. is a prime defense contractor, ranking 24th in the nation
for the fiscal year of 1964 with $233.6 million worth.15 In 1959, military
businesses accounted for 34% of R.C.A.’s direct sales and 45% of company profits.16
Similarly, in December 22, 1966, the Federal Communications Commission approved the merger of International Telephone and Telegraph
Corporation with the American Broadcasting Company (radio and T.V.).
I.T. and T., in the last two years alone, “has moved through acquisitions
into car-rentals (Avis, Inc.), mutual funds and life insurance (Hamilton
Management Corporation and Great International Life Insurance), small
loans (Aetna Finance Company), and book publishing (Howard W. Sams
and Company).”17 I.T. and T. was ranked 28th in defense contracts with
$256.1 million worth in 196418 while its other major sources of profits is
foreign sales. 19
Colombia Broadcasting System (radio and T.V.) in 1966 alone, moved
into its sources of entertainment through purchasing the New York Yankees and by developing an intimate financial relationship with Warner
Bros. Movies. Further, C.B.S. moved into educational toys by buying Creative Playthings and into publishing by buying an influential 11% stock
interest in Holt, Rinehart, and Winston. The moves into educational toys
and publishing are part of a developing trend: “It is just the beginning,”
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said President Frank Stanton, “of an extended program in the new fields
of education...”20 Chairman of C.B.S., William S. Paley, is a trustee of Columbia University. C.B.S. was ranked 154th in defense contracts in 1963
with $2,244,000 worth.21
General Electric (which acquired a textbook company) and Time Inc.
(which owns Silver Burdett Textbook Company, and acquired a French
publishing house and a New York graphic society) have formed a 50-50
partnership in the General Learning Corporation to develop and exploit
new teaching techniques.22 G.E. was ranked 6th in military contracts in
1964 with a $892.6 million worth.23 G.E. makes 40% of its profits from
the military, 11% from foreign investments.24 There are many examples
of centralization within the past year. The situation is summed up by a
Forbes article on communications: “The boundaries between the different
forms of mass communications are breaking down.... now; television-set
makers publish books, magazine publishers own T.V. stations, and educational research organizations and book publishers own schools.” 25
This centralization of T.V. - radio - publishing - education - defense
industries should not lead us to a false romanticization of more “independent” sources of information and ideas. Almost all large-scale publications are controlled by men of wealth. Newspapers and magazines are dependent on advertisements to survive: In 1958, advertising accounted for
more than 70% of all newspaper revenues; more than 60% of all periodical
revenues; and, of course, 100% for commercial radio and T.V.26 General
Motors alone spent $122 million on advertising in 1960.27 Standard Oil of
New Jersey spent $45 million on advertising in 1959.28
Information sources not dependent on large-scale advertising seem to
be prone to more direct influence, as evidenced by the Senate Foreign
Relations Committee’s 1963 hearings on foreign lobbies. For example, in
1958, International News Service merged with united Press to form U.P.I.
The merger included I.N.S.’s Special Services Division which made “The
reporting facilities of the world’s largest newsgathering organization”
available “on a commercial basis” (from the U.P.I. promotional blurb).
Special Services clients included Rafael Leonidas Trujillo, late dictator
of the Dominican Republic. (U.P.I. does not feel that the Special Services
Bureau interferes with its objectivity.) Small, “independent”, newspapers
depend on sources such as the U.S. Press Association, which writes and
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Revolutionary Youth & the New Working Class
sends editorials to 1399 American newspapers (any given editorial might
be used by about 10% of those newspapers).
The Associations 300 “clients” includes The Dominican Republic Information Center which handled public relations for Trujillo; and Solvago
and Leo, public relations firm for a complex of Portuguese firms involved
in Africa. Solvago and Leo arranged for a free, guided tour of Portuguese
Angola for 55 members of The National Editorial Association (for small
publications). Hamilton Wright Organization, public relations firm for
Union of South Africa, and Nationalist China, created its own “independent Asia expert”, Don Friefield, who wrote speeches for congressmen
and columns for publications.29
The centralization at the top of major sources of communications has
deeply penetrated our major educational institutions, as already indicated
by R.C.A. chairman Sarnoff’s and C.B.S. chairman Paley’s relations with
Columbia University. The key problems for colleges and universities are
sources for much-needed funds. While the universities were always dependent on the wealthy, they are becoming increasingly dependent on the
government, particularly the Defense Department. Government and private corporations have an identical interest.
Thus, by 1958 student fees and tuition accounted for 27.9% of the
financing of higher education, while the federal government provided
24.6%.30 The figures for Columbia University in 1963/64 are more typical for the large, modern university: Students provide [ca.] 20.5% of
revenue; government research contracts and grants over 50%. Further,
the government funds was the most rapidly growing sector, and by now
is easily more than 50% of Columbia’s budget.31 Close to half of these
government funds came from direct military contracts–$18,731,000 in
1963. In 1968, MIT received $70,284,000; John Hopkins, $65,483,000;
California U. $12,222,000; U. of Michigan $1,246,000; Stanford U.
$8,775,000; Illinois U., $7,689,000; Cornell, 1,433,000; George Washington, $4,715,000; U. of Washington, $4,647,000; Penn State, $4,646,000;
U. of Penn., $4,423,000; Chicago U. $3,765,000; NYU, $3,732,000; U.
of Texas, $3,671,000; all from the Defense Department. The more than
70 other universities among the top 50 defense contractors include Harvard, Brown, Northwestern, Princeton, Minnesota, Wisconsin, Duke,
and Yale. 32
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59
The universities should not be viewed as passive victims of the need
for external sources of funds. The large private universities themselves are
important loci of power, frequently owning large amounts of real estate and
stocks. To return to our example, Columbia, endowment and investment
income is the third largest source of revenue, after the government and
tuition. In 1964, Columbia held a total investment of $199,882,301. The
University’s investments included $11,475,621 of common stock in oil (an
industry heavily involved in foreign investment and defense contracts)
and $10,359,628 in public utilities.33 (Those investments have increase
greatly since the 1963/64 financial report.) This investment orientation
isn’t surprising, considering that the Columbia Trustees include directors
of Socony Mobil Oil, Shell Oil, Consolidated Edison, Ohio Edison and
AT&T. Most of the other trustees are directors of banks, trust companies,
and insurance companies that hold interest in the areas where Columbia
invests.34
The Trustees, of course, rarely interfere with the content of what is
taught (which usually remains within certain “respectable limits). Instead,
they deal primarily with broad institutional policies, such as whether the
University will conduct secret research, train personnel for the military,
provide facilities for recruitment by the CIA, etc. The content of education
and research is affected more through the more subtle means of government and private foundation research grants.
Research grants do not include explicitly political criteria, but the notion of what types of projects are acceptable provides a more general orientation to the development of social science. The following is take from
Harold Orland’s survey of professors receiving research grants:
“The preference of government agencies for “safe” and “project-able”
rather than venturesome research, and for experimental rather than theoretical work was noted by many observers...
Some psychologists objected to...the choice of “clean” experimental
design over new ideas and procedures. Economists objected to agency
loaning to econometrics and quantitative work.
Thus sociologists complained about the restriction of government programs to quantitative, statistical, and computer analyses to the exclusion
of qualitative and descriptive approaches; political scientists, about the
shying away of political implications, which lie at the heart of the field.
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Anthropologists criticize the initial concentration of NSF upon archaeology and physical anthropology, the politically “safe” areas, to the exclusion of social anthropology...35
The conference of the Anthropological Association, held in Pittsburgh
in the winter of 1966, expressed detailed criticism of the CIA’s interference with anthropological studies.
In short, the government is willing to support research to work out
certain problems within general social and political assumptions: money
does not flow to social scientists who do work that might challenge those
assumptions. The private foundation grants generally serve the same
purpose, although a study of specific foundation programs is beyond
the scope of this paper. One important example is the role of the Carnegie and Rockefeller Foundations in establishing Russian Institutes at
Harvard and Columbia and similar Far East Institutes.36 The Rockefeller
Foundation alone has founded over $160 million for the humanities and
the social sciences. The total assets of such foundations are ca. $12 billion.36
The point is that for professors to succeed they must produce, and
research costs money. Except for those consciously opposed to such a tendency, professors will tend to orient their work toward the types of projects
that receive financial aid. By 1958, organized research accounted for 50%
of the expenditure for resident instruction.37 For the social sciences, Orland’s survey indicated that for the year 1960/1, 38% of teachers and professors in the universities studied had some part of their research, teaching,
study, or consulting financed by the federal government. (Only 18% of the
faculty at liberal arts colleges participated.38 The private research foundations reach many that the government doesn’t reach. The new Senate bill
for a National Foundation of Social Science will only serve to heighten
the government’s influence.39 Pervasive influence of such government and
private grants, in view of the complaints recorded earlier, has much to
do with the hyper-empiricism and the “value-free” stance fashionable in
contemporary American social science–an approach that avoids any basic
challenge to the status quo.
The socialization process does not begin with university life and the
corruption of the social science, but starts at the lowest levels of education.
The socialization process carried on in primary and secondary schools
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leads to an acceptance of the “legitimate” institutions of authority and to a
paralysis of critical thought and activity.40
The pattern described so far – the centralization and interlock of TV
– radio – advertising – publishing – educational materials – universities –
research grants – defense contracts –– provides no shocking expose. Education and communication cost money and therefore will be controlled by
the sources of wealth in the society. Increased technology leads to an interlock in these fields. This structure does not imply a conspiracy is the major
force. Advertisement, culture, and news, all tend to be blurred together;
mass sell avoids the controversial and the insightful; education is primarily socialization; social science becomes hyper-empiricism. There is no
conspiracy buy rather a dominant notion of “responsible” news, “popular”
culture, and “worthwhile” scholarship develops out of this confluence of
interests.
These ostensibly objective measures really mask the framework for
imposing and maintaining the dominant ideology. The ruling class in
America can afford its showpiece of free elections every four years, since
this class controls the terms and assumptions under which social questions
are perceived and discussed.
Mass Society and the Alienation of Labor
“The ideology implied by the model of affluent consumption is
not so much a life of ease, as the life of the monad immured in
his isolated, self-sufficient universe; In a home fitted out with all
modern conveniences (i.e., in a closed universe independent of
exterior services), in which he can watch the world as a show
on television, from which he emerges to take the wheel of his
private car and drives off to enjoy the sights of a countryside
“unspoiled by man”....The denial of the social origin and nature
of human needs and of the necessarily social character of their
satisfaction; the assertion of the possibility of a purely individual
liberation by the acquisition of the means of escape (the social
character of whose production is painstakingly concealed): these
are the basic mystifications of the affluent society.
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“In this implicit rejection of individual responsibility for society,
which casts the social out into the realm of “accidental”, lies the
root cause of massification–that powerless, anarchical solitude
of separated individuals, suffering their social existence as a
statistical, external reality, and manipulated in their individual
behavior-pattern by the technicians of “hidden persuasion”.41
–Andre Gorz,Strategy for Labor,
In the last ten to fifteen years there has been a growth in the body
of literature concerning mass societies.42 These theories range from interpretations concerning the increased powers of social manipulation caused
by technology to the role of technology itself. Most formulations involve
questions of mass communications and leisure time activity, but a few
relate the experience of work to the dehumanization of play. The more
adequate of these theories relate to the processes of mass society to the
capitalist framework of production.
Capitalism penetrates every sphere of life
Capitalism subjects society to the service of private accumulation in
the form of individual consumption and taste. It extends itself into every
sphere of public and private life: work, leisure, the home, school, news,
and even human relationships. Capitalism defines and creates the type of
personality that can accept and perform the activities most beneficial to
the system, i.e., in his capacity of the passive consumer.
The other side of Marx’s dictum of 19th century capitalist society–accumulate! accumulate! accumulate!–now holds true: consume! consume!
consume! The passive consumer is none other than the “mass individual”,
manipulated, brutalized, and addicted to the needs of capitalism: production for the production’s sake, and the manipulation of society into a state
of compulsive consumption, all grown out of the needs of profit and accumulation.
Another aspect of the mass individual, as Marcuse has brilliantly analyzed,
is the debilitation of all forms of critical thought. Whether in the world of intellectuals and scholarship, or in our general activity generated by leisure time
consumption, capitalism only allows for an examination and acceptance of the
assumptions of the system, rather than its potential for change and liberation.
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To summarize Marcuse: Among the intelligentsia, the social sciences
develop positive methodologies that avoid questions of history and the
dynamics of change. Society, this society is, therefore, it will always be.
Philosophy is reduced to the logico-grammatical analyses of sentences
and words: philosophy that questions meaning and purpose in human and
social existence and search, in a critique of the present, for the liberating
potential of the future, is reserved for the metaphysical trash bin of history.
Commitment is unscientific and everything in the modern world must be
scientific.42
The same applies to our leisure time entertainment. There is a bland
acceptance of everything that is; we are fulfilled in a way that is totally repressive, whether socially or sexually. Excitement is a Ford Mustang; passion is a cool hair groomer; love of nature is a Marlboro filter-tip; history
is a Saturday Evening Post article about Everett Dirksen and Joe Namath;
politics is the art of Lyndon Johnson; and societal identification is a $1.00
picture of John and Jackie or maybe a color television set. And society is
always there.
Manufacturing the ‘Need to Escape’
Social manipulation, tied to the needs of consumption, essentially develops the need to escape and, as Andre Gorz points out, hides the social
character of the production of those needs. The need to escape in leisure
time, as most critics of mass society work to point out, is the escape from
the pressure of industrial organization and work in general.
This escape is a distraction from the very nature of the need itself;
alienated labor, and as generalized in the capitalist society, alienated existence. To escape into the consumption of leisure time, i.e., to distract from
alienated labor, does not let men question the basis of the system itself, the
capitalist control of the means of production and thereby of the quality of
one’s life. “Capitalism civilizes consumption and leisure to avoid having
to civilize social relations, productive and work relationships. Alienating
men in their work, it is better equipped to alienate them as consumers; and
conversely, it alienates them as consumers the better to alienate them at
work.” 44
Consumption, as an alienated mode of existence, is the dialectical
converse of alienated labor: Together they form the basis for what is
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called “mass society”, which in America is none other than the system
of organized corporate capitalism which this document is attempting to
describe.
The Politics of American Capitalism
Ask not what your country can do for you, but what you can do
for your country.
– JFK
The Two Political Tactics of Capitalism
Politics in American society involves the creation of an American
public: at the same time, it involves the impotence of such a public; and its
disenfranchisement. The formally elected centers of power, the President,
Congress, and state officials are the backbone of a political system of representation which wishes to call itself democratic. An abstracted American
public casts votes at various periodic intervals on the range of policies and
decisions which are impossible to reduce to one set of attitudes, primarily
embodied in specific individuals.
With the introduction of all-encompassing media techniques sophisticated and rationalized by technological growth, the imposition of party
labels which have become symbolic of only the vaguest kinds of ideological values and attitudes, and the growth of a Cold War emphasis on political program which has even further circumscribed the range of ideological division, this American public has become completely removed from
feeling even the smallest direct share on the government of its affairs.
Politics in American seems far removed from the presentation of coherent
political program. Elections are increasingly tied to campaign costs, effective advertising techniques–to the extent that advertising concerns are
becoming the sin qua non of political electioneering–and, in general, the
professionalization of politics in its every aspect. This political mode of
democracy is lauded as the most notable and impressive distinction between the American form of government and those of the socialists of the
Third World. (Democracy vs. Communism.)
The content and nature of American politics, however, has not developed and will not develop into a static pattern. Beginning with the depression years of the ‘30’s, new forms and images of political programs have
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been adopted to meet the requirements of the situation. The inception of
the Cold War produced equally programmatic innovations, especially in
the area of foreign affairs. The underlying formal aspects of the political
process have also changed. The professionalization of politics, for example, has produced new formal features relating to the electoral experience;
e.g., how to campaign, where, why, etc. Therefore, analysis of American
politics requires more than a static model; even more important, it requires
structural analysis that goes to the root of both the form and content of
politics itself.
Since the end of World War II, American political life has been dominated (with the exception of the Henry Wallace candidacy and disaster) by
two political conceptions of strategies: liberalism and conservatism. The
differences in patterns that separate the two are limited and can be defined
largely as the specific responses to one or another situation. One strategy
(liberalism) has been on the rise; the other has had to change its style and
composition to adjust to the socio-economic realities of corporate capitalism. Together, Liberalism and conservatism form the whole of American
political strategy and choice; together, they also describe a large area of
consensus.
Consensus, for the most part, comes out of the accepted range of ideological beliefs and values. The private (corporate) control over the means
of production, the narrow base of decision-making power, and the priorities involved in the allocation of resources are all assumed and accepted in
the political (parliamentary) context. In the national Congress, especially
since 1948, maximum consensus has been reached in the area of anti-communism, both domestically and externally. The 1954 Communist Control
Act, the most extensive piece of domestic anti-communist legislation, was
written and introduced by liberal senators such as Morse and Humphrey.
Anti-communism as a foreign politic is equally a product of consensus.
Recent differences over the Vietnam War can not be traced solely to differences over liberal or conservative positions, but to a reaction to the
obvious irrationalities of the war itself. Criticism of the War in Congress
relates to the inadequacy of our military program. We are not winning the
war; therefore, one position calls for escalation; the other for a stop to the
bombings. The roots of an anti-communist foreign policy are still beyond
critique.
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Related to anti-communism is the consensus concerning the level of
defense spending. General demands for increased expenditure rarely receive more than a token amount of negative votes.45 Since 1950 there has
been a dramatic increase in those expenditures, to the extent that it has
become the priority item in the allocation of resources and the primary
pump for the national economy.46
Along with defense spending, there has been a qualitative increase in
space expenditure over the past few years. As with national defense, the
assumptions and purposes of such programs are never questioned. What
is sometimes at stake is the importance (money) given one space program
over another in order to adjust to the immediate needs of publicity.
Finally, the last and most inclusive area of consensus is that of the
capitalist or non-socialist character of the American ideology. American
politicians must always pay due respect to beliefs and values concerning a
free and open market. While division exists between liberal and conservatives over the role and size of the public sector, the real democratization
(participation and control) and extension of the public sector and the socializing of private means of production are concepts outside the range of
this view. However, the question of the public sector is probably the root
cause for increasing division between liberal and conservative strategies.
Routes of Neocapitalism
The United States has only recently begun to set out on the rationalizing and integrating routes toward neo-capitalism–a capitalism of a mixed
economy, welfare state nature that has found its fullest expression in Western Europe. Western Europe has achieved, this form of capitalism primarily because of the presence of a strong left-wing labor movement, the shattering experience of World War II, and the rise of a technically competent
elite. Given the absence of these three factors in the United States, plus the
emergence of the anti-communist ideology, the development of a rational
system of capitalism is far from realization. US neo-capitalism can occur
only after a protracted and prolonged ideological within the confines of
capitalism itself.
In foreign policy the beginnings of this struggle primarily concern disarmament-arms control mechanisms and accommodation with the Soviet
Union. The Sino-Soviet split has given this trend and added boost. What
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still works against this process is the ideological resistance of anti-communism that has taken root in every section of the population. An amazing
and striking paradox of this struggle was found in the agreement of the
Rockefellers and Cyrus Easton concerning extended trade with the Soviet
Union. Objections to this kind of trade have been raised by trade unions.
Thus, an ideology created by business interests and imposed on the entire
population, remains strong even when its creators no longer consider it
economically useful in its entirety.
In domestic policy debate centers around social legislation (social
welfare services and the extension of the public sector.) The cornerstone
of a rationalized capitalist system is the amount of money allocated for
education purposes. Until the 88th Congress even educational allocations
were bitterly contested. As Richard Titmuss has pointed out, while education is “today the most revolutionary and explosive force in developed
and developing countries (it still benefits) proportionately more children
from better off homes... (and allows) the system (to be) redistributive in
favor of the rich.” 47 However, Titmuss also points out that education is
increasingly useful in fulfilling the needs of the technical and professional
positions called for by an advanced industrial society. This need has been
recognized by certain corporate and governmental powers,48 (legislators
always seem to lag behind these centers of power), and seems to be an
irreversible trend. The fact that it still occupies a place in the area of dispute testifies to the strength of the ideological residue and the protracted
political struggle that still has to occur. The dispute takes place within
a consensus–universal federal control over integration and regulation of
the educational system. The conservative position, states’ rights, wants no
(with the exception of anti-communist) strings attached to federal money;
the liberal position wants federal strands of control, e.g., integration in the
Southern schools.
The other areas of social legislation (welfare, full employment, greater
equalization of income, etc.) are more central to the liberal-conservative
dispute. However, the nature of the present debate is over the size of appropriations not over their necessity, another indication of the prevalent
trend. The Johnson administration has greatly furthered this process;
though, interestingly, enough, it has demonstrated the utter inadequacy
of the programs as they are presently constituted, resulting in the kind
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of criticism, even left criticism, that did not appear during the Kennedy
administration. Part of the growth of a new student left and a civil rights
movement can be attributed to the inconsistency and gap between rhetoric
and reality. However, the dispute continues and provides the only area for
commitment and passion, albeit rhetorical, within the wall of Congress.
The nature of the liberal-conservative division also demonstrates that
Congress, and the electoral process itself, represents only a secondary
source of power. This thesis, first developed by such thinkers as C. Wright
Mills and Walter Lippman,49 states that the complex and technical nature
of decision-making have placed the primary sources of power in the administrative groups of the public sector and of the huge corporations, with
an increasing integrations of the two. Congressional differences are still
important; especially those concerning social legislation, for the outcome
will create the conditions for the functioning of a rationalized capitalist
system, i.e., social stability and equilibrium. This struggle is far from resolved and is the public, as opposed to the private, side of decision-making
and trends in American capitalism. The concept of corporate liberalism, a
pronounced attitude in domestic and foreign policies, is more related to
the hidden side of decisions. It is something that can be traced outside the
context of parliamentary debate, and it influences decisions outside the
scope of electoral choice.
The concept, however, should not be equated with the liberal political
strategy represented in Congress: For the practice of American capitalism, at least in its public face, is essentially one of consensus and dispute;
consensus in the area of confrontation, and dispute that develops within
the limitations of the capitalist system. The concept of corporate liberalism
points to the underlying political framework of American capitalism: As
such, it needs separate analysis.
Corporate Liberalism
Corporate liberalism implies that the dominant economic institution is
the corporation and that the prevailing political and social mode is liberalism. This formulation does not deny that other trends exist within American society, but states only that these are the dominate trends.
To better situate corporate liberalism, we must examine its historical
genesis. The New Deal was the era in which the trends toward corpo-
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rate liberalism became dominant; indeed, it was the shit of the New Deal
that brought to bloom the corporate liberal weed from its capitalist dungheap.
The political conception that developed out of the corporate structure
in the New Deal was liberal in nature. A.A. Berle Jr., one of FDR’s original braintrusters, stated in 1932: “It is conceivable–indeed it is almost
inevitable if the corporate system is to survive–the ‘control’ of the great
corporations should develop into a purely neutral technocracy, balancing
a variety of claims by various groups within the community and assigning
to each a portion of the income stream on the basis of public policy rather
than private cupidity.” 50
This pluralist (corporate liberal) conception of American society was
far from reality; the “corporate system” that Berle referred to had a definite and far from democratic power structure. For example, the Temporary
National Economic Committee found that in 1939 the top 200 corporations, which controlled about 50% of the wealth of all corporations, were
run by about 2,500 people.51 As we saw earlier, this trend has not be reversed. The social policies of the New Deal must be seen in light of this
structure. The public reforms of the New Deal did not solve the problems
of the depression.
For example, unemployment figures during the New Deal were 24.9%
in 1933, 14.3% in 1937, and 19% in 1938. The figure was only dramatically reduced to below 5% in 1942.51a At the same time, capacity utilization rose dramatically only with preparations for World War II. Thus, it
was World War II, with its 11 million men in the armed forces and its nonconsumption production, which pulled the country out of unemployment
and under-utilization.51a
The War and the specific restrictions it placed on consumers were the
immediate causes of the post-war boom. Because of restrictions during the
war in buying, debts were paid off and vast amounts of savings were accumulated. However, many of the problems present in the pre-war period
reappeared by 1950. For example, using capacity utilization of the year
1950 as 100, by1953 the figure was 83%.51b Besides that, military spending became a permanent feature of the Cold War economy.
The legal aspects of the corporate society involved situations where
“the citizen was almost wholly dependent upon the definition of pub-
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lic welfare that emerged inside the national government as a consensus
among the leaders of the various functional syndicalist elements of the
political economy.” 51c
The lack of control within a consensus as defined by this legal aspect
of American society is generally applicable within a class society. The lack
of control describes the central feature of the gap between rhetoric and
reality in corporate liberalism.
For example, public welfare programs, a crucial component of this
rhetoric, are totally inadequate in reality. Gabriel Kolko found that in
1958, families having incomes of $0-$4000, paid more in taxes than they
received in welfare benefits.52 The current War on Poverty programs is another example. The first question concerning this program is whether the
administration’s approach is directed toward eliminating the long existing
poverty in our society or toward staving off the newly developing revolutionary potential in our ghettos.
This difference is not a mere quibble, for, while a war on revolutionary
potential might involve certain short-run measures to ameliorate poverty,
its long-range effect would be to essentially preserve the current social and
economic structure. This divergence between avowed and actual purpose
explains why the current “poverty” program is lacking in conception as
well as in funds.
A program really geared toward eliminating poverty would place
primary emphasis on eliminating unemployment. To briefly and schematically sketch an example, the government could invite the people of
a ghetto, such as Harlem, to form community councils which would be
provided with city planning and architectural consultants. The government
would then provide a $2.50/hr wage for all unemployed Harlem males
for clean-up and construction jobs decided upon by the community, and
which might include such projects as large educational parks, strategically
located to promote integration.
Direct employment would provide the most basic way of striking at
the “problems of the Negro family” which in turn would eliminate a major
source of educational handicap. Community control would eliminate the
large costs of maintaining the bureaucracy necessary to ensure government control (to make sure that agencies like the old Mobilization For
Youth don’t go too far in promoting the interests of the poor). Community
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control might also mean that many old buildings would be renovated rather than destroyed and replaced with characterless projects; current prohibitions against families with “illegitimate” children might be removed, etc.
Finally, people working in their own community are more likely to take
care of it and have self-respect.
In contrast, a program to stifle revolutionary potential and serve the
interests of the current employers class would do the following: 1) Separate indigenous leaders from the community by neutralizing them with
relatively high paying government jobs or by assimilating potential leaders into major while institutions (e.g., the universities), 2) Blunt racial consciousness by seeing that a few visible Negroes received status jobs, 3)
Prevent unemployment from reaching revolutionary proportions but still
provide a pool of unemployed as a buffer against wage pressure and inflation. 3) Retrain a certain amount of unskilled workers to offset the wage
pressure caused by the shortage of skilled workers and technicians.
Thus, the “war on poverty” has provided community service jobs for
the more articulate community people and education programs geared toward getting the brightest children of the poor into college. (Both projects
are helpful to certain individuals but do not strike at the structural roots
of poverty.) While some job training has occurred, President Johnson was
quick to apply economic “brakes” last spring when the war in Vietnam
threatened to plunge the unemployment rate below 3.5% (not counting
hidden unemployment).
These tendencies in the poverty programs as guided by the currently
dominant consensus should make us particularly wary of the gap between
the rhetoric and reality of corporate liberalism, a gap that takes its most
extreme form in the area of foreign policy.
Imperialism
The Structure of U.S. Imperialism
The ideology of American foreign policy is extreme anti-communism.
This ideology did not develop in a vacuum, but rather relates to a definite
structure of interests within the American corporate system. Those interests demand the maintenance of a definite division of labor between the
United States and the Third World, a division of labor crucial to maintain-
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ing key U.S. interests. A country that has gone or goes communist breaks
out of that worldwide market system and division of labor dominated by
the United States and, in so doing, provides the same impetus to countries
in similar situations who can now see world capitalism as a possibly transient system.
The significance of this structure of interests can’t be understood simply in terms of gross figures on foreign trade and investments, since even
small percentages can be crucial. To cite the Rockefeller Panel Reports,
“Between 9 and 10 per cent of all the durable goods produced in the United
States is sold abroad. Significantly enough, these sales provide the margin
between profit and loss for a large segment of American industries.” 53
The importance of foreign trade can not be accurately measured by
simply computing it as a percentage of GP. As Harry Magdoff points out
in his excellent article “Economic Aspects of U.S. Imperialism” (Monthly
Review, November, 1966), GNP includes government expenditure, personal and professional services and activities of banks, real estate firms,
and stockbrokers–i.e., non-productive expenditure and simple transfer
payments. The Department of Commerce measures the economic significance of exports in relation to total domestic production of movable
goods–i.e., the sale of agricultural products, mining products, manufactures, and freight costs. This figure for 1964 was $280 billion.
The magnitude of foreign markets, however, should not be measured
simply in terms of our $25 million in export sales. Our foreign sales include output resulting from U.S. investments abroad (direct and indirect).
Those sales amounted to $143 billion in 1954. This output added to the
$25 billion in exports is $168 billion; subtracting for double counting (e.g.,
some of our exports are included in foreign output as parts), we get a total
foreign market of ca. $110 billion, or about 40% of the domestic $230 billion output of farms, factories and mines.54
The most important aspect of our foreign trade is an outlet for our
manufactures. Total export and sales by foreign-based US firms has grown
from $15.8 billion in 1950 to $57.9 billion in 1964, or from around 10.6%
to 35% of the sale of domestic manufactures.55 Further, in the past ten
years domestic sales increased 50%; foreign, 110%. Another important
indicator of the importance of foreign-based manufacturing firms is the
expenditure on plant and equipment: 8.1% of such domestic expenditures
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in 1957; 17.3% in 1965.56
Thus, foreign trade must be seen in terms of our foreign investments,
which provide much greater market outlets. Further, the profits on these
investments are higher than domestic rates. In 1950, earnings on foreign
investment represented ca. 10% of all after-tax profits of domestic nonfinancial corporations; by 1964, 22%. This figure does not include allowances for well-known methods of masking foreign profits by subsidiaries
selling to the home firms below market value, service payments to the
home firms,57 high freight costs to related shipping, etc.
It would seem, then, that a more accurate estimate of the importance
of foreign markets and investments indicates that foreign sales equal between 25% and 40%58 of total domestic sale of moveable goods; and
foreign-earned profits equal at least 22% of domestic non-financial corporate profits. Further, in both sales and profits, the foreign sector is growing
much more rapidly than the domestic.
These statistics in themselves do not indicate the nature of U.S. imperialism, since the majority of investment and trade is carried on with Europe and other developed nations. Once again, over-all investment figures
are misleading since profit rates are much greater in the underdeveloped
world. Thus, between 1950 and 1965 U.S. direct investments in Europe
and Canada amounted to 110.9 billion, while investments in the rest of
the (underdeveloped) world were $9 billion. Nevertheless, income on this
capital transferred to the U.S. was $11.4 billion from Europe and Canada;
but $25.6 billion from the rest of the world. Thus in the underdeveloped
regions almost three times as much money was taken out as put in. In addition the value of U.S.-owned direct investment within these areas increased
greatly during this period–from 8.5 to $10.3 billion in Latin America; from
$1.3 to $4.7 billion in Asia and Africa.59
Similarly, the U.S. maintains a very favorable balance of trade with
the underdeveloped world. In 1965 our exports to these areas were ca.
$11.0 billion while imports from these areas were only ca. $9.7 billion–a
favorable balance for the U.S. of $1.3 billion.60 More important than the
volume is the content of our trade with the underdeveloped nations–i.e.,
our import of raw materials. While modern technology provides synthetics
to replace certain raw materials, our overall industrial development seems
to be requiring greater and greater amounts of raw materials.
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Thus, the President’s Material Policy Commission reported the following in 1952 [Resources for Freedom, Washington, D.C.]: at the turn
of the century the U.S. produced ca. 15% more raw materials (other than
food and gold) than domestically consumed; by 1950 the U.S. consumed
10% more than it produced, and trends indicate that the deficit will be
20% by 1975. 61 Similarly, a U.S. Defense Department pamphlet published
in 1953, “Raw Material Imports: Areas of Growing Dependency”, indicates that the military consumes about 15% of these imports, including a
much greater percentage of alloying metals. The report cites “27 strategic
imports...without which our industrial economy would collapse”; one example is manganese, an alloy essential as a hardening agent for steel, of
which we import most of what we use.62 The Statistical Abstract of 1966
provides a partial list of important materials, giving imports as a percentage of new supply for 1963; gum and bark, 100%, iron ore and concentrates, 32%; lead and zinc ore, 23%; bauxite, 87%; manganese ore and
concentrates, 94%; uranium ores, 61%; fluorspar, 66%. We also imported
$56 million worth of industrial diamonds (no percentage given), $1,212
million in petroleum63 For the first quarter of 1965, we imported about
14% of our petroleum needs.64 and our needs for gas and oil will probably be increased by 50% in the next ten years despite a growth in nuclear
power.65
Linked with our need for raw materials is the need for our out-production economy to export manufactured goods. Thus, overall figures given
earlier on the foreign market as a percentage of the domestic market and
our favorable balance of trade with the underdeveloped world give some
indication of the order of magnitude. It should also be noted that as our
productive capacity goes up and our need to export increases, the underdeveloped world profits the greatest potential market, providing its consumption rate increases faster than its industrial productivity.
Given low personal income levels, the governments of underdeveloped countries become important consumers of U.S. manufactures. Thus,
in November 1963, President Kennedy defended our foreign aid programs
by pointing out that 90% of the “aid” was tied to the export of U.S. products. At the same time, to take one of our most liberal programs, the Alliance for Progress, aid was made in the form of loans. U.S. aid means that
client governments buy U.S. products and then pay us back with interest.
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Furthermore, most of this aid goes for the purchase of military equipment.
Of the $50 billion spent on aid from the end of the Marshall Plan up to
1960, $30 billion went for military expenditures.67
The export of military equipment is another form of export of manufactured goods. They provide another critical means of generating demands and profits in an “under-consumption” economy.
Once again, the importance to the economy surpasses the gross expenditures by the Defense Department ($68 billion), since government
military expenditures serve as a stimulus to the economy. For example,
not only did the $55 billion spent on defense in 1962 employ, directly and
indirectly, 7.4 million people, but also another 6 to 9 million were employed due to the economic stimulus of this spending–a total of 13 to 16
million out of a labor force of 78 million (6.4 million of which are either
unemployed or underemployed).68
Military spending combined with exports provides a crucial stimulus
to the output of non-residential investment goods, a key factor to the health
of the economy. Magdoff lists the industries producing non-residential investment goods, and shows that in 1958 federal government purchases
(almost all military) and exports accounted for 20-50% of the purchases in
all industries but three (two greater than 50%; one less that 20%). Needless to say, a 20-50% demand can be key to the survival of such industries,
and these percentages have undoubtedly increased with the Vietnam War.69
Another measure of the importance of this interrelationship is the profit
sources of the largest twenty-five corporations (by sales, in 1959): foreign
investments 28.% and military 11.5% (total 40.4%).70
In summary, the structure of U.S. imperialism is a complex of relationships more important than any single statistic indicates. It involves
a favorable balance of trade (total $6 billion surplus)71 which secures us
much needed raw materials while providing an important outlet for our
manufactures (35% of domestic output).
At the same time, this arrangement provides for investment outlets
more profitable than domestic investments (providing 22% of domestic
profits) and simultaneously helps secure market outlets. Finally, the “free
world” economic penetration requires protection, which involves a large
demand for military production (and profit on a cost-plus basis), also stimulating the need for raw materials. This defense also provides the excuse
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for selling our military (waste) production to client governments (with
90% of our foreign aid tied to exports).
The Conflict of Interests
This structure of U.S. corporate interest conflicts with the needs of
the Third World in many ways. One point is the need of these countries
to generate capital through foreign exchange, while the U.S. corporations,
who have the power to control market prices, want raw materials at favorable price levels. Thus Kwame Nkrumah points out that between 1955 and
1965 Ghana and Nigeria tripled their production of cocoa; yet their gross
earnings fell by 6%.72 At the third annual meeting of the Inter-American
Bank, the Finance Minister of Colombia stated that his country lost 2 to
3 times as much foreign income from drops in coffee prices as it gained
through Alliance for Progress credits;73 and so on. UN studies have shown
that, while the underdeveloped countries enjoyed a $1.8 billion trade surplus in 1950, price changes transformed this position into a $2.3 billion
deficit by 1962. Notably, the trade between the underdeveloped and socialist countries is about equal; the deficit all comes from trade with capitalist countries.
We must, however, avoid the simple conclusion that price increases
will solve the capital-generating problems of these countries. A large percentage of the sources of raw materials are foreign-owned. In Latin America, U.S. interests own 85% of the companies producing the materials exported to the U.S.74 A large part of the increased revenues gained through
price rises would leave those countries in the form of capital outflow in
high foreign profits.
Outflow of capital is, of course, another major problem of the underdeveloped countries, as already indicated by the figures showing that U.S.
investors take much more out of these countries than they put in. Further, this capital functions according to the needs of the U.S. corporations,
rather than according to the needs for balance and integration in the economies of the client nations. Any move to assure that total profit generated is
reinvested into the developing economy through nationalization is, as we
have seen on many occasions (from Cuba to Ceylon), violently opposed
by the U.S.; e.g., section 620 (o) of the Foreign Assistance Act of 1962 instructs the President to cut off all foreign aid to any country nationalizing
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or excessively taxing U.S.-owned corporations, unless compensation is
“equitable and speedy,” a condition impossible for a country low on cash,
that has already paid many times over through excessive profits.
Prohibitions on nationalization also interfere with meaningful land reform in countries where U.S. corporations have large land-holdings, and
even our liberal Alliance for Progress puts effective limits on land reform.75
Nationalization might also mean that U.S. corporations would have to pay
higher prices for their raw materials, or–worse–that a nationalist government would redirect these resources toward developing their own industries, which would provide substitutes for import of U.S. manufactures.
The problem of markets for U.S. manufactures is perhaps the most important and subtle aspect of this complex. While it is true that this interest
is in conflict with rapid industrialization in the undeveloped world, U.S.
capital is not inextricably opposed to manufacture in these areas. First of
all, growth in sales requires some rise in the standard of living in these
areas (although inequitable distribution of wealth is most advantageous
since the very wealthy will be the most interested in U.S. imports). A good
deal of U.S. foreign aid goes to the commercial sector in order both to
increase this type of consumption and to help to expedite exports to the
U.S. U.S. capital, however, will continue; such investment will be used for
controlling local markets.76 But, it is important to realize that this investment is controlled in terms of the market needs of U.S. capital. This control prevents integration, public benefit and the type of industrialization
essential to the underdeveloped nations.
Military pending is critical
Finally, military expenditures provide the binding power of the entire
complex. Not only does our military aid serve as a means of export of U.S.
manufactures, as we saw earlier, but also it inhibits the industrialization
of the Third World. Thus, for example, the underdeveloped countries received $4 billion in capital for economic development from the industrialized countries of the world, but spent collectively $18 billion on military
items. Professor Leontief of Harvard has estimated that an over-all investment increase of $16 billion per year could raise the growth rates of the
Third World from the current 2.1% (about the same as population growth)
to the 4.3% growth rate of the industrialized countries.77 Latin American
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governments alone spend $2 billion per year–double what our Alliance for
Progress lends them–on the military.78 Pakistan, the Philippines, Greece,
South Vietnam, to give a few examples, all spend over 5% of national
income, about the same percentage that they spend on national productive
investment.79
The money that both the U.S. and client governments spend of the
military also provides for the emergence of a strong military elite, favorable to the U.S., within these countries. This internal elite is designed to be
instrumental to maintaining U.S. interests without direct intervention.
In summary, while U.S. foreign investment might bring slow development in certain sectors of the Third World’s economy, a fundamental
conflict of interests exists, the interest of U.S. capital in:
1) a favorable balance of trade,
2) the use of cheap raw materials,
3) profitable capital investment (therefore capital drain) and
4) markets for manufactures, including military
As opposed to the life and death needs of the people of the Third
World in:
1) a favorable balance of trade to build up foreign exchange surpluses,
2) full capital investment,
3) planned integration of economies involving the use of some of
their own resources to develop their own industries, and
4) breaking the social power of reactionary classes and elites.
This conflict of interest has expressed itself in U.S. foreign policy in
many different forms on countless occasions from CIA-led coups (Iran,
1953; Guatemala, 1954) to “exiles” returning (Cuba, 1961) to outright
U.S. invasion (Vietnam, Dominican Republic). This conflict is expressed
through close CIA contact with reactionary elements (Indonesia) or simply
through working knowledge of right-wing elements throughout the Third
World that certain policies will be rewarded with U.S. aid (a significant
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factor in the eleven coups in Africa in the past 3 years.) Imperialism does
not always take the form of overt military action, but frequently assumes
more subtle and potentially more rational weapons.
A Case Study: Chile
The central features of U.S.–Chilean relations can be perceived in
Chile’s economic structure and development. The Chilean economy is
structured around copper production (e.g., copper provides 2/3 of Chile’s
exports.) Until the recently elected Frei regime came to power, 90% of
Chilean copper was owned by two American companies: Kennecott Copper, through its subsidiary Brandon Copper, and Anaconda, through its
subsidiaries of Chile Exploration Co. and Andes Copper Mining. As of
1959, the net capital investment of these companies had been $539 million.81 The amount of declared profits shipped back to the United States
was $1,464 million.80
The current Frei government has been recently been held as a third
way, by such sources as the New York Times. The heart of Frei’s new
programs of “Chileanization” (as opposed to nationalization) has been the
attempt to ostensibly change the hegemony of U.S. copper interests in
Chile. Interestingly enough, the American copper companies financed a
large part of Frei’s campaign in 1964.81
The basis of the Chileanization program involves: 1) The Chilean government receives a share of ownership and management in certain mines
for which it provides the funds to expand production. 2) Concerning the
Anaconda mines, Anaconda retains complete control over both mines,
including the largest copper mine in Chile, which accounts for 46% of
Chile’s production. Anaconda will own 75% and the Chilean government
25% of the next mines to be built. All subsequent mines will be 49% government owned. 3) The government will hold a 51% share of the El Tente
mine of the Kennecott Co. In return the government must pay $80 million
in compensation. 4) New mines of the Cerre Co. will be 85% owned by
the government. None of the money needed to pay for the share in El Tente
will come from a loan from the U.S. Export-Import Bank and the Agency
for International Development. In order to pay back the loan, Chilean copper production must rise from the present level of 617,000 metric tons to
1.2 million by 1970. Another part of the arrangement was the reduction of
U.S. taxes and export duties.82
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The economic section of the Times revealed the real meaning of this
program: There has been a severe shortage of copper, and the American
companies have been forced to resort to expensive open pit mining in Arizona and Montana. Since Chile has not nationalized the mines, and instead
instituted the present arrangement, the American companies have managed to shift their burden of finding new copper sources onto the Chilean government, which may or may not profit. To quote U.S, News and
World Report, “There is broad agreement that the moves will benefit U.S.
firms.”83
This situation must be viewed in contrast to the potentials of nationalization. Since 1928, Chile lost $3 billion in profits to the U.S. Even if
Chile had paid the companies their full value for nationalization, it still
would have retained $1.5 billion, which is more than Chile’s trade deficit
accumulation.
The use of these funds could have made Chile nationally solvent. If
the $1.5 billion had been left in Chile, it would have accumulated to $3
billion. This amount of money could give each of Chile’s poverty-stricken
and ill-housed citizens a $3000 house and $1000 worth of food.84
In fact, the rhetorical nature of Frei’s programs can be seen in light of
Chile’s grave social and economic problems–inflation (the cost of living
rose by 25.9% in 1965 and 21% in 196685 despite Frei’s new politics),
poverty (per capita income of $452;86 50% of all Chileans suffer from
malnutrition87) and general utilization of resources. Rhetoric about Chileanization helps to stave off the real political threat of nationalization in a
country where a strong left-wing party exists.
The third way alternative, in terms of the hegemony, no matter how
subtle and rational, can be best described in the words of Fidel Castro:
“He (Frei) has promised revolution without blood, and he has given blood
without revolution.” 88
American capitalism offers the rhetoric of revolution and the reality
of blood. Domestically, American capitalism offers the rhetoric of the free
individual and welfare for all and the reality of corporate control, socially
compulsive though unnecessary labor, and a permanent under-class—this
in a society with the greatest potential for human liberation in history.
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Post-Scarcity
The Surplus
The problem of the surplus describes one of the most important crucial
contradictions within capitalist society. The concept of surplus value found
in Marx’s writings: first that value is defined as labor and secondly that the
capitalist appropriates surplus value (profit) by appropriating labor time;
i.e. paying wages below the worth of worker’s product. The Marxian concept has been reformulated by Paul Baran to deal with the contemporary
situation. Baran breaks down surplus into two parts, actual and potential
economic surplus. Actual economic surplus is “the difference between society’s actual current output and its actual current consumption.” Potential
economic surplus is defined as “the difference between the output that
could be produced given natural and technological environment with the
help of employable productive resources, and what might be regarded as
essential consumption.”89
Baran’s concept of actual surplus differs from potential surplus in that
the former deals with only that part of the surplus that has been accumulated. It does not include the consumption of the capitalist class, administrative government spending, the military, etc. Its virtue is that in being
essentially savings and capital formation, it is easily measurable. Potential
surplus excludes essential capitalist consumption and essential outlays for
governmental administration. It includes output lost by underemployment
or misemployment of productive resources. This concept is extremely important, for it goes beyond the categories of any given system to which it
is applied, and therefore allows one to see the alternative of different social
system. This approach makes it almost impossible to tabulate accurately
the surplus statistically. The use of the potential economic surplus points
out the possibilities of a social system are superior to corporate capitalism.
By breaking down the potential surplus into different parts, we can more
clearly see the waste in capitalist organization and production.
Society’s excess consumption can be seen in the lavish spending of the
rich, manipulated consumer needs, and frequent style change. Advertising,
another prime example of waste spending ($15 million a year90), is one part
of a system of cultural values that creates the needs and desires of a “Pepsi
Generation”.
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Output lost because of irrational and wasteful spending probably takes
the largest part of this hidden surplus. Planned obsolescence falls into the
category of wasteful and irrational spending. The automobile could be
made to last much longer if profits were not dependent on a rapid turnover. G.E. carried out courageous research to shorten the life of the light
bulb. This problem has been popularly conceptualized in the movie “The
Man in the White Suit”, where the owners of a clothing mill do everything
in their power to keep a newly-discovered indestructible fabric off the
market. The motor sector of irrational waste spending is in the field of the
military.
Other categories of this potential surplus involve unemployment and
underemployment (no work, part-time work, lay-off without pay, seasonal
work, etc.). While there is a great need for people in many fields, unemployment is still a permanent factor in everyday life. Further, many ghetto
youth see no sense in applying for a job; thus real unemployment is always
underestimated in official statistics.
These categories can be only methodologically separated because of
the interrelation. The ability to transcend these categories and to see the
degradation and cost of human lives in this society, which can be achieved
by looking from what is to what should be; this is the first step toward
working out a real alternative to contemporary society.
The Quantity-Quality Gap
The ever-increasing GNP of the U.S. can not be relied on for reassuring evidence of the success of American capitalism. Gross statistics mask
the concrete quality of life in America. The other side of waste consumption is the concrete human needs unfulfilled in this society.
The problem can be presented by summarizing Seymour Melman’s
book, Our Depleted Society. Melman’s thesis is clear: “The ability of a
society to enlarge its capacity for money spending must be differentiated
from limitations on a number of people with special talents.” 91 With this
proposition in mind, Melman, pointing to the high salaries of specialized
defense work, estimates that 2/3 of our prime technical research talent
goes into military-oriented work.
The result of this lopsided demand on our finite technically talented
personnel is clear. In 1950, America had 109 doctors for every 100,000
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people; in 1963, only 97 even though we are draining 1,600 each year
from other parts of the world where they are sorely needed. 827 teaching
posts in medical schools are vacant, and while the standards to medical
school have dropped considerably, we are not training enough doctors to
keep up with population growth. Similarly, 1 of out 5 nursing positions in
U.S. hospitals is vacant.
This depletion of medical personnel helps to explain the infant mortality rate in the U.S. of 25.2 per 1,000 births, as compared to Sweden’s
15. Significantly, the rate is 22.3 among white Americans and 41.4 for
non-whites. Immeasurable other deaths probably result from inadequate
medical attention.
A related problem is the increasing air (and water) pollution, which
causes a variety of pulmonary and heart diseases. The “killer” London fog
of 1952 killed 4,000 people with a sulphur dioxide content of 7/10 part
per million. (Sulphur dioxide is the most lethal air-pollutant.) The sulphur
dioxide content in NYC exceeds that proportion almost every month, and
reached 3 parts per million in March 1963. Cigarette smoking, a part of the
compulsive consumption examined earlier, compounds the effects of air
pollution whose primary cause is the unregulated industrial refuse. Lung
cancer–a rare disease 50 years ago–is now taking the lives of 50,000 men
and women every year.92 The January, 1967, Reader’s Digest claims that
diseases related to air pollution and smoking are the fastest growing diseases in America.
Similarly, one wonders how many deaths would have resulted in automobile accidents if half the money that has gone into needless style
changes and advertising, had been redirected toward safety; or, better yet,
if large sums had been invested in developing alternative transportation
systems. In 1964, 48,000 people were killed and 2,000,000 people were
injured in car accidents. Further, safety could be greatly increased in most
industries, housing construction, etc.
Indeed, even housing is a major problem in the U.S., which as
9,225,000 substandard housing units. The private sector is only expected
to build 2,225,000 units in the next five years, and this projection was
made before housing construction starts reach a twenty year low due to the
economic pressures caused by the War in Vietnam. To describe the situation more graphically, slum apartments in NY are so rat-infested that “on
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the average one hundred persons a year are badly chewed and, so far this
year, two have been gnawed to death. Symbolically, perhaps there are in
N.Y. more rats than people–an estimated 9 million of them.” 93
The lack of sufficient technical personnel is circularly affected by our
inadequate educational programs. In 1963, 83,200 teachers had officially
substandard credentials, and perhaps the vast majority was actually substandard for an advanced industrial society. 32,000,000 American adults
(22%) are “functionally illiterate”, not having completed the 8th grade.
The problem, as Melman points out, is not simply one of scarce personnel but also of allocation of funds. Thus, U.S. government expenditures
for non-defense purposes was (in 1963 dollars), $83 per capita in 1939;
$56 in 1963. Non-defense buying by federal, state, and local government
accounted for 17% of GNP in 1939; [12%?] of GNP in 1963. Health, education, welfare, housing, and community development expenditures accounted for 42.5% of the federal budget in 1939, 7% in 1965.
This richest country in history has 6 tons TNT-equivalent deliverable
nuclear explosive power for every person on earth; it can “afford” the war
on Vietnam; it spends $15 billion a year on advertising and employs countless other techniques for absorbing the surplus. Yet, basic human needs are
not met. If we could calculate the death and injury caused by inadequate
medical care and research, air pollution and cigarettes, inadequate housing and food, improper safety devices, and socially produced violence, we
might find that a very large percentage of deaths and injuries are socially
necessary. Thus, even domestically, American capitalism, which has stabilized itself at the expense of the impoverishment of the Third World,
proves to be a violent system.
More on Post-Scarcity
To discuss the concept of the post-scarcity society is to discuss, in
its profoundest sense, the liberation of men and the creation of a socialist
society. In Marx’s writing, the concept of capitalism and human history
develops out of the liberating potential of industrial wealth. Before and
including bourgeois society, men had engaged in a struggle with nature
in order to control it and transcend the conditions of subsistence. Nature
imposes limitations over men’s capacity to create their own conditions of
fulfillment and control their own lives. These relations are always modi-
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fied by the permanence of history: Men hake history, but only under the
circumstances handed down and defined by history.
With the advent of capitalism and the industrial order, men first develop the far-reaching implications of the technological control over nature.
But under capitalist order two major problems arise, both caused by the
nature of the relations of production in its human and technical equivalents. First, in a budding industrial organization, the full maturation of
technology and technical control over nature is far from complete. Overcoming the problems of scarcity is a long and arduous process involving
the rationalization of technological growth in its purpose and use. When
scarcity exists, necessity prevails.
In this kingdom of necessity, neither liberty nor equality, nor fraternity, were possible. There can be no equality where goods are so scarce
that only a minority can possess them; there can be no fraternity where
rapid industrialization imposes iron hierarchy and work discipline; there
can be no democracy where lack of education creates an elite, lack of material possessions creates privilege, and lack of external security creates a
permanent national mobilization.94
Secondly, capitalist society introduces the factor of man’s exploitation of man. Defined in class terms, divisions are created between income
levels (stratification) and in the ability to control the decisions and social
processes affecting the entire society. Capitalism creates the entrepreneur,
and eventually the corporate holding, whose raison d’etre is accumulation and profits, which contradict a total fulfillment of social needs. The
technical conditions allowing for post-scarcity are achieved, but the political, social, and economic reality of corporate capitalism denies the total
rational use of this wealth and potential wealth (surplus). The creation
of a post-scarcity is linked to the use of available potential surplus. In a
capitalist system of production, surplus is squandered to meet the needs of
compulsive consumption and profit maximization.
Irrationality of Waste
Waste production leads to a military economy whose very notion is
antithetical to the concept of post-scarcity society. Military expenditure,
besides creating the ideological values and social aspirations that contradict the fulfillment of social needs and individual potentiality, is waste
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production in its most irrational sphere. The creation and production of the
means of violence has no place in post-scarcity society. As Engels once
said, “In a socialist society, violence would be relegated to the museum
of antiquity.”
The reality of the military economy also raises other programs and
aspects that prevent creation of a post-scarcity situation: its international
nature. Post-scarcity can only develop when the international, as well as
the national, division of labor and the distribution of wealth are abolished.
Defense spending and military might, foreign aid, and the general socioeconomic manipulations for controls exercised by the U.S. over most of
the underdeveloped nations prevents the realization of post-scarcity on a
world-wide basis. Marx’s notion of the relative and absolute immiseration of the poor is applicable in an international perspective of relations
of subordination and superordination. Imperialism prevents the industrial
take-off and economic growth in the under-developed world necessary to
eliminate the problems of starvation and disease that plague the world.
Post-scarcity is incomprehensible in circumstances where 100,000 people
die of starvation each day, 500 million children are underfed, 35 million
people die each year of hunger and a situation which, from 1980 on, could
produce a universal famine throughout the Third World,95 a famine whose
central ingredient of support is American imperialism.
Eliminating Poverty
One of the key conditions of post-scarcity, then, is the elimination of
poverty amid affluence, whether nationally or internationally. To eliminate poverty requires a level of wealth (potential wealth) which, taken
in the context of the advanced industrial societies, has been or could be
realized. The introduction of automation and rationalizing techniques and
procedures in industrial organization also makes possible the social complexion of post-scarcity. The language of post-scarcity is the language of
the fulfillment of all social needs and of non-compulsive labor. Only in
the post-scarcity situation is it possible to eliminate the social division of
labor and thereby social stratification. The concept of post-scarcity is the
nearest modern equivalent of the socialist vision of the withering away of
the state and of the ability of people to control their lives, in the context of
the development of society as a whole.
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As long as activity is non-voluntary, but naturally, divided, man’s own
act becomes an alien power opposed to him which enslaves him instead of
being controlled by him. As long as the division of labor exists, each man
has a particular, exclusive sphere of activity, which is forced upon him,
and from which he can not escape.
He is a hunter, a fisherman, a shepherd, or a critical critic and must
remain so if he does not want to lose his means of livelihood; whereas,
in communist society, where nobody has one exclusive sphere of activity
but each can become accomplished in any branch he wishes, production
as a whole is regulated by society, thus making it possible for me to do
one thing today and another tomorrow, to hunt in the morning, to fish in
the afternoon, to rear cattle in the evening, and criticize after dinner, in accordance with my inclination, without ever becoming hunter, fisherman,
shepherd or critic.96
Post-scarcity is participatory democracy as the modus vivendi of societal organization and inter-action. It allows men to be freed from the
needs of centralized organizational imperatives; for the real embodiment
of a de-centralized socialist society. As such it contradicts the political and
economic needs of contemporary corporate capitalism; as such it also lays
the groundwork for a critique of that society. This critique is materialized
in the demands for control, participation, and de-centralization, the emerging concepts of the new student left: a new left which could become the
true children of Marx by fulfilling his vision of society:
“...when the enslaving subordination of the division of labor,
and with it the antithesis between mental and physical labor,
has vanished; when labor is no longer merely a means of life, but
has become life’s principle need; when the productive forces
have also increased with all-round development of the individual, and all the springs of cooperative wealth flow more
abundantly–only then will it be possible to completely transcend
the narrow outlook of bourgeois right, and only then will society
be able to inscribe on its banners: From each according to his
ability, to each according to his needs.” 97
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The Trends in American Capitalism
Technology and the Labor Force
Modern American capitalism is characterized by rapid technological change, with scientific knowledge growing at a logarithmic rate.
There has been much public discussion on the social implications of
such technological change, from predictions of the elimination of unskilled labor to divisions of newly created idiot jobs relating to tending
machines. Actually both tendencies are correct. Sidney Fine’s careful,
though somewhat limited in conception, study of automated jobs for the
Department of Labor, indicated, “There is a polarization of jobs on the
two ends of the skilled spectrum.”1 Automation tended to create both
more skilled jobs involving the supervision of a complex system of machines and very boring and unchallenging jobs of simply tending and
feeding machines.
To determine the long-range effects of technology, we must distinguish three levels of automation:
1) extension of men’s physical capabilities,
2) (cybernetics) extension of men’s mental capabilities,
3) (cybernation) joining of physical and mental equipment into a
system of production.
We are now in a situation where much has been done on the first level; a trend is developing for greater employment of the second level, and
a little has been done to employ the third level. Thus, this first level of
automation has somewhat reduced the over-all need for unskilled workers, the tending and feeding jobs created not keeping pace with the jobs
eliminated. However, as production proceeds to the third level of automation, feeding and tending jobs tend to be eliminated. The clerical jobs,
and the rate of increased of such jobs have already slowed down. Clerical
work that remains will probably be low paid work, increasingly tied to
machines, resembling factory working conditions. The demand for technically and professionally skilled personnel will tend to increase as technology progresses.
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These trends are already indicated by changes in the composition of
the labor force. The tendency for even the first level of automation to
eliminate unskilled labor seems clear. In 1947, 626,000 production workers produced 4.8 million cars; in 1963, 572,000 produced 9.1 million.2 In
1950, 540,000 production workers turned out 96.8 tons of steel; in 1960,
460,000 produced 99.3 million tons.3 America will witness, during the
1960’s, the permanent loss of at least 200,000 non-agricultural jobs per
year owing to automation.4
The following figures provide a comparison of the composition of the
(white) labor force in 1950-1965:5
Occupation Group% of Labor Force
1950 1965
Laborers 5.0
4.5
Operatives 20.6 18.2
(a total decline of semi- and unskilled jobs from 25.6% to 22.7%)
Craftsmen and foreman 13.7 13.5
(a total decline of blue collar workers from 39.3% to 36.2%)
Clerical 13.8 16.3
Sales
6.9
7.1
Non-household service
6.9
8.7
(Middle sector while collar has grown from 27.6% to 32.1%.)
Professional and technical 8.0
(The fastest growing sector)
13.8
(Other groups–farm; managerial, private household)
Our earlier discussion indicates that the technical sector will grow even
more rapidly in relation to the others, and the blue-collar sector will decrease at a heightened rate. Jobs in some industrial labor will become more
complex. A change that will affect the entire labor force will be increased
educational requirements. The general trend already outlined is toward
an increase in jobs that require high degrees of education and training.
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However, educational requirements will apply even to unskilled workers.
Since new technological developments can unpredictably eliminate such
jobs, these workers will need a great deal of flexibility. Further, managers
seem to understand the value of the socialization process that occurs in
schools and therefore want workers with a high school education for even
the simplest jobs. Thus, unskilled and clerical workers will be increasingly
more “educated” to obtain increasingly simply and unchallenging jobs.
This problem will be just one aspect of increased alienation as workers
become further and further removed from their products. In sum, the overwhelming tendency is toward an increasingly more educated labor force,
with the most educated (technical and professional) becoming the most
essential to the productive process.
Centralization and Planning
Technology is one of the factors influencing further centralization of
control in American society. The best example of this process can be found
in our earlier section on communications: Just as past technological developments linked makers of electrical equipment (RCA) with radio and television (NBC), current developments lead to a link with education and publishing (Random House). And, of course, these are all linked up with the
technological vanguard industry, defense contracts (RCA). Technological
breakthroughs will continue to link up diverse industries. Further, rapid
technological change provides an additional incentive for management to
achieve control over diverse industries, since it is possible for any single
industry to become technologically obsolete. This consideration is behind
the development of such a complex as Textron which actually includes forty different companies from men’s perfume to helicopters. Technological
change also increases the incentive to control more diverse possibilities of
national supplies and market outlets. Another factor in multidimensional
control is provided by anti-trust legislation. This legislation has been selectively used without any one given market sector, but does not apply to
diversification and the mega-corporations.
The problem of centralization of control does not result simply from
diversification by large corporations. Another crucial factor is the socalled managerial revolution. This concept was first popularized by James
Burnham in 1941 and has received a more modern and sophisticated de-
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91
velopment in Adolph Berle’s Power Without Property. Central to Berle’s
thesis is the increasing trend of industrial capital to be internally generated
(reinvested profits) by the corporations, which means that a smaller percentage of capital comes from floating new stock. Thus, Berle, writing in
1959, summarizes “of the capital flowing into non-agricultural industry,
60 percent is internally generated through profits and depreciation funds.
Another 10 or 15 percent is handled through the investment staffs of insurance companies and investment trusts, Another 20 percent is borrowed
from banks. Perhaps 5 percent represents individuals who have saved or
chosen the application of their savings.” 7 By now, 75% of corporate capital is internally generated.8
The implication, to Berle, of the increased internal financing of corporations is an increase in the proportional control of pension, trusts, and
mutual fund managers: Stock ownership is the formal means of choosing
directors and managers of firms: as these funds increase their stock holding, the degree of control will grow disproportionately since stocks constitute a decreasing percentage of capital.
Berle saw a particular shift of power to pension-fund managers (chiefly in N.Y. banks) since such funds involved a high incentive for high riskprofit investment (i.e. common stock) to keep up with the rapidly expanding requirements on such funds. Actually pension funds have not assumed
the role that Berle predicted; they accounted for 3.5% of all outstanding
stock in 1959, and probably grow to no more an 6.5% in 1965.9 Nevertheless, mutual funds (arrangements through which managers handle and
control the funds of a group of investors) have grown from total portfolios
of $13 billion when Berle wrote, to $38 billion in 1966;10 and it has been
estimated that bank-administered personal funds account for close to 1/4
of all corporation stocks.11
Interlocking Groups
Actually, we do not have to resolve the conflict as to what degree power lies with business managers as apposed to various funds managers for
these groups interlock. Our earlier discussion of the Columbia Trustees,
who themselves control $200 million in Columbia assets, provide typical
examples: Grayson Kirk is a director of Con. Edison, Socony Mobile Oil
and a trustee of Greenwich Savings Bank; Frederick Kappel was Chair-
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man of AT&T, a director of General Foods and of Chase Manhattan Bank
and of Metropolitan Life; Alan Temple is a director of the Monsanto Corp.
and Prudential life Insurance Co. and First National City Bank; Maurice
Moore is a director of General Dynamics and Chemical Bank NY Trust
and Time Inc.; William Burden is a director of Allied Chemical Corp.,
Lockheed Aircraft and Manufacturer’s Hanover Trust.12
The point is that both the internal corporate financing and the proportionate increase in managed investment funds leaves effective control of
the economy with a small group of inter-locking managers; a control that
extends beyond direct ownership. There centralization of control must be
seen in terms of our earlier discussion of corporation power in an economy
where “some five hundred great corporations dominate through outright
ownership two-thirds of the industry of the United States.” 13 Despite specific errors, Berle’s over-all prediction has proven true: “A relatively small
oligarchy of men operating in the same atmosphere, absorbing the same
information, moving in the same circles in a relatively small world, knowing each other, dealing with each other, and having more in common than
in difference, will hold the reins.” 14
In his very next sentence, however, Berle reveals that he misses the
social significance of his own lucid exposition: “These men by hypothesis
will have no ownership relation of any sort. They will be, essentially, nonstatist civil servants...” 15 The myth that the new managerial elite is radically separated from ownership and profit motive and can therefore exercise
impartial, efficient control over society is simply contrary to fact: First of
all, salary levels (and concomitantly status) are tied to profits. Secondly,
stock options are a form of remuneration. By 1957, options plans had been
instituted in 77% of the manufacturing corporations listed on the NY Stock
Exchange and in 87 of the top100.16 These options are particularly valuable
since insider’s knowledge helps them to make money out of company stock.
Thirdly, high salaried executives are the group most likely to own stock (in
either companies), as long ago as the early 50’s 44.8% of all executives held
such stock.17 Since managers constitute close to half of the spending units
owning a 1,000,000 dollars or more in marketable stocks, they may well account for over half of the individually held stock in the U.S.18
What then is the meaning of the “managerial revolution”? Simply,
while there has been no radical separation between ownership and control,
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93
there has been a partial separation which itself has profound implications.
Diversification of stock ownership permits those with the greatest ownership stake to work for their own profit through a control over industry that
extends way beyond their own scope of ownership. The existence of 20
million stock-holders in America does not evidence a “people’s capitalism” or “share holder’s democracy” but rather the ability of the managerial
class group to marshal additional capital for their own purposes. The concentration of stock ownership outlined earlier is still great, but the trend
toward a greater number of small stock-holders allows those in the centers
of power to use their own capital more effectively. Thus the diversity of
small holders usually assures corporate control for a management with just
10-20% of the stock. Meanwhile, 20 million people feel that they have an
owner’s stake in the system.
The shift in emphasis from ownership to management, then, is really a
method of extended control, which makes the ownership on the part of the
managers more effective and profitable. This social implication for future
trends is important. Briefly, since corporations are increasingly internally
financed, since larger percentages of stock are controlled by a few managers, since diversification of stock ownership leads to the fragmentation
of opposition; the new managerial class has immensely increased power.
Since stock funds invest in a range of companies, since large corporations
are diversifying through mergers, since managers buy stock in other companies; the new managers have interlocking interests throughout a continually wider range of the economy.
Baran and Sweezy, in Monopoly Capitalism, discuss the transition from
the owner-entrepreneur, who would build to destroy companies for his immediate profit needs, to a more stable capitalism where the locus of power
is with the company man, who prospers through the growth and profits with
the company he is associated with. We are now moving into a stage characterized by companies’ men, where the locus of power is with those who have
a wide range of interests. This range of interests differs from the old trustbuilding in that the new, multidimensional control extends into different sectors of the economy that previously might have expressed opposing interests. Just as company men could begin thinking in terms of the long-range
stability of their corporation, companies’ men are likely to begin thinking in
terms of the long-range stability of the system as a whole.
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Revolutionary Youth & the New Working Class
This change in the perspective of key men of power provides the base
for a potentially much more rational and flexible capitalism. The logical
extension of a rational and flexible capitalism is planned economy and a
welfare state. The neo-capitalist countries of Western Europe have already
taken this path. The economics of this neo-capitalism has been described
by Andrew Shonfield in Modern Capitalism.
Shonfield states that the Western European countries have been able to
maintain both rapid and steady economic growth and full employment of
both labor and technology through the following basic techniques: 1) increasing reliance on the public sector which can stabilize and counter-act
market fluctuation, 2) social welfare and worker training which serve as
stabilizing factors, 3) diffusing of incomes rising with productivity which,
combined with expanded foreign trade, maintains consumption demand. A
new and more sophisticated technique, embodied in the Wallon Plan, calls
for a greater integration of the working class community within a specific
plant through such means as profit-sharing and greater worker responsibility for lower level technical decisions. This plan has not yet been accepted,
but has received De Gaulle’s blessing.
The specific methods and degree of public sector planning and investment vary throughout Western Europe. The process toward planning has
been greatly furthered with the advent of the Common Market; a plan
developed in 1955 which looked for the eventual economic and political
integration of the whole of Western Europe. Although political integration
is a distant reality, economic integration is almost complete; in fact, one of
the characteristics of neo-capitalism that can be attributed to the Common
Market is the role of the technocrats in taking the initiative for the expansion of methods of planning and integrations.
Shonfield is ambivalent about the potential for neo-capitalism in the
United States. He sees several factors leading in that direction. In Shonfield’s view, President Kennedy achieved a major breakthrough by achieving the acceptance of tax-cuts and government spending to keep unemployment down to 4%. (Kennedy’s tax-cut mainly benefited the corporations
with a 7% cut in tax for capital investment and the tax-cut was supported by
the National Association of Manufacturers.) Kennedy was evidently aware
of the success of the European model as are other more advanced political
leaders. This will undoubtedly further the push toward neo-capitalism.
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95
Further, continued advances in technology tend to increase the need
for planning (to deal with large-scale, complex production and more rapid
change) and provides the tools to handle such planning (computers). Indeed, Shonfield describes modest initial approaches toward greater planning within the private sector as indicated by new groups and services
such as the National Planning Association, National Association of Business Economists, National Industrial Conference Board, and the increasingly popular McGraw Hill business estimates survey.
Perhaps the most important factor that Shonfield discusses is Robert
McNamara’s role in bringing technical rationality and coherent planning
to the Defense Department, America’s largest enterprise. McNamara’s influence has permeated out into the economy since careful Defense Department supervision meant that “some of the most advanced and dynamic
firms in American industry...have had part of their management processes
redesigned for them in certain standard patterns.19
The influence of McNamara’s planning techniques has greatly increased since 1965, when President Johnson, impressed with the successful administering of the Defense Department, ordered that PPBS
(planning-programming-budgeting-system) be introduced into all departments of the federal government.20 Thus, McNamara, systems analyst and
higher technocrat, has rationalized American capitalism in its most irrational sphere.
The major obstacle to the development of neo-capitalism in the U.S.,
according to Shonfield, is the American ideology: “this bias of pluralism”.21
Shonfield does not deal with the changing socio-economic structure of centralized control. This new structure provides a real potential for America
to move past its nativistic ideology. The non-interventionist ideology was
formed by the large corporations in response to the efforts of small business and professionals to use the government as a counter force against big
business. This force reached its fullest expression in the progressive movement of the early twentieth century. With the demise of the power of small
business and the absorption of many professionals into large corporations,
the corporate powers can now more readily perceive their own interest
in government. Government intervention and the expansion of the public
sector, long a central demand of the left, may well become a sophisticated
tool of corporate capitalism.
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Revolutionary Youth & the New Working Class
The trend toward neo-capitalism is not certain. Ideological lags have
their own force, especially if the American power structure finds itself
more hard-pressed in the area of foreign policy. Nevertheless, the potential
for neo-capitalism in America clearly exists, even if major steps in this
direction can only come in response to economic and political crises.
The potential for a mixed economy and welfare state does not mean
the capitalism and socialism are converging. First of all, state planning
under capitalism, especially in the United States, is more likely to take the
form of planned demand than public control over investment. But even if
the government share of investment greatly increases, the systems remain
distinct, for, to use George Lichtheim’s criteria, socialism requires elimination of private property in the means of production and workers’ control
of industry. Neo-capitalism does not absorb socialism but rather those socialists who stick primarily to wage and welfare demands.
Imperialism and the Third World
Whether imperialism is “absolutely necessary” to advanced capitalism is not an essential question, since U.S. policies will be oriented toward
involvement in the Third World for some time to come. The question is
whether this involvement involves a series of costly imperialist wars.
The war in Vietnam can lead to a false romanticization of the revolutionary potential of the Third World. The National Liberation Front enjoys
the advantages of a well-developed anti-imperialist consciousness and organization, a terrain well suited to guerrilla warfare and a friendly Communist nation on its border. The coups in Indonesia and Africa and the U.S.
intervention into the Dominican Republic provide less hopeful models.
The factors working against revolutionary challenges to the U.S.
include the following: 1) the U.S.’s ability to create intermediary elites
within these countries, especially well-financed military establishments,
to oppose revolutionary movements; 2) more sophisticated counter-insurgency techniques; 3) greater flexibility of U.S. capitalism through limited
aid and investing more U.S. capital in manufacturing in these countries,
determined according to the market needs of American capitalism; 4) the
threat of U.S. intervention.
On the other hand, there are powerful factors which would tend to
raise the revolutionary potential within the Third World. First of all, pe-
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97
riodic Food and Agriculture Organization reports indicate that increase in
food production has not been far above population growth in recent years
and may well have fallen below in 1966. Per capita food production in
Asia, excluding China, for 1966 was lower than its pre-World War II average.23 India’s per capita food production in 1961 was only 86% of that of
1890.24 Not one of the Asian countries has average dietary level up to the
2,500 convinced adequate.23
The economic growth of the Third World is just keeping pace with
population growth, both c. 2.1%, and this economic growth rate is only
about half that enjoyed by the industrialized countries.25 Even a large percentage in growth of the tiny Third World economy would be relatively
small compared to the increment that even a fraction of that growth would
bring to the richer industrialized countries. Thus, the gap will continue to
increase for sometime, while improved communications are heightening
the Third World’s perception of Western wealth. While little or no absolute
progress is being made, both the relative immiseration and the perception
of this gap increases.
This immiseration will be perceived in light of appealing alternatives.
China has already far surpassed India in the production and distribution of
food, medical care, literacy, steel and coal production, etc.26 The economic
growth of the socialist countries can provide more opportunity for trade
and aid. The terms of this aid is more favorable than those of the U.S.
because 1) interest rates on loans are lower, 2) more latitude is given for
industrial projects, 3) it does not involve an unfavorable balance of trade
for the Third World. There is a dialectic between more effective oppression and greater consciousness of revolutionary alternatives.
If the United States can avoid costly wars, this structure of imperialism would serve to reinforce and strengthen American capitalism. Foreign
markets would reduce pressure on a over-production economy, and the
other remunerative aspects of U.S. imperialism that we outlined earlier.
These benefits would be able to finance and pave the way for a more rapid
transition to neo-capitalism.
The other alternatives, protracted series of imperialist wars, would
provide serious difficulties for U.S. capitalism. A continued gold drain
will weaken the U.S.’s financial position in world trade. Short and longrange war-caused inflation could limit and outstrip growth in economic
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productivity. Further, America does not have the technical personnel and
resources to build both the warfare and welfare state; war spending does
not contribute to the production of consumer or production goods. Finally,
the gradual loss of our current economic colonies may put a severe strain
on our foreign-involved economy.
Civil Rights
“The economic philosophy of black nationalism is pure and
simple. It only means that we should control the economy of our
community.
“There can be no black-white unity until there is first some black
unity. There can be no workers’ solidarity until there is first some
racial solidarity.
“All the countries that are emerging today are turning toward
socialism. I don’t think its an accident. Most of the countries that
were colonial powers were capitalist countries, and the last bulwark of capitalism today is America. It’s impossible for a white
person to believe in capitalism and not believe in racism.”
–Malcolm X
The civil rights movement has provided the impetus for the resurgence
of protest and political activism in the 1960s. At the present time the civil
rights movements faces many complex problems. The current SNCC and
CORE slogan of “black power” indicates the sensitivity of these groups
to the need of involving the growingly restive ghetto population. Malcolm X symbolized the ambiguities behind black power. His thoughts had
two implications concerning this problem; his earlier emphasis on black
shopkeepers or black economic control within capitalism, and his latter
emphasis on racial unity and socialism.
Much has been done recently to blur racial consciousness, especially
through a growing acceptance of Negroes into white collar jobs. Between
1950 and 1960, the per cent of non-white workers holding professional
and technical jobs rose from 3.0% to 6.8%; in clerical jobs from 3.5% to
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8.2%; as craftsmen and foremen from 4.8% to 6.7%.27 By 1963, 23.8% of
all non-white were earning $6,000 per year and over.28 Since then, the poverty program, among other things, has tried to create a visible, integrated
middle class, while not affecting the problems of the ghetto Negroes.
The creation of a visible Negro middle class, while the conditions
of the Negro masses remains unchanged, would imply that black power
might tend to assume more of a class (socialist) dimension than simply
a race consciousness. Nevertheless, many of the new Negro white collar
workers will retain a radical consciousness. While the total percentage of
the Negro labor force holding white collar jobs increased from 10.2% to
19.5%; between 1960 and 1965, the percentage of these in the managers,
officials, and proprietors groups, only increased from 2.5% to 2.6%.30 The
Negroes given higher level jobs are rarely placed in positions of authority,
and will become alienated from the system trying to absorb them. Dissident white collar workers might tend to heighten the strictly racial dimension of black power. Even with the strong tendencies towards a class
critique, racial consciousness will be an important part of the black movement for some time to come.
The emphasis on black power does not relegate the civil rights movement to a position of an irrelevant minority.
First of all, they have presented a challenge to concerned whites to
undertake new programs and ideas for radical social change.
Secondly, there is a possible link of the civil rights movement to the issue of imperialism. Negro soldiers returning from a racist war in Vietnam are
likely to be a source of heightened agitation in the ghetto Also as liberation
movements grow throughout the world, Negroes are bound to find inspiration
for their own struggle, already stimulated by African independence. Negroes
may be a minority in America, but as both Malcolm X and Stokely Carmichael have pointed out, colored people constitute a vast world majority.
Thirdly, Negroes, many of whom have already perceived the poverty
program as a mode of manipulation, will probably continue to be an important vanguard in raising demands for community control.31
Students
Simply on a statistical level, youth and students constitute an increasingly important sector of the American population. Nearly 50% of all
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Americans are 25 years old or younger; college and university enrollment
has doubled, from 3 million to 6 million in the past ten years.31 Further,
the changing composition of the labor force implies that students, as trainees, will become crucial, as technically skilled workers, to the key productive processes in society. This importance is already evidenced by the
student draft deferment, which serves both the freedom to avoid military
service and the compulsion to continue within the university.
While students become more necessary to the established adult society, their recognition of the new potential of a non-compulsive social order
(post-scarcity) develops attitudes of withdrawal from, passive acceptance
of, or rebellion against the adult world. Students, who are being prepared
to comprehend the productive process, can best perceive the over-all contradictions implied in situations of lack of control over the processes of
shaping one’s life. Students, who recognize these contradictions can, as
intellectuals, provide the theoretical framework for a movement wanting
to change society–thus the new left.
Communications
The development of mass media that could reach large numbers of
people involved capital-intensive equipment, which meant that mass communications has been largely controlled by a wealthy elite. More recent
technological advances have led to increased centralization of control.
Current discoveries, however, provide the capability of reaching larger
audiences with low capital investment. For example, laser beams can provide an unlimited number of TV channels,32 while miniaturization could
soon produce TV equipment within price range of such groups as SDS
and SNCC. Such technological advances allow for the real potential for
decentralized control over communications, in which previously marginal
groups could creatively participate and receive a more equitable hearing.
Nonetheless, as this potential increases within the current socio-political context, methods of extended bureaucratic control will probably be
employed. The trend is indicated by the pressures placed on the Pacifica
Radio Foundation by the FCC, under its crusading liberal Chairman Newton Minow. Decentralized control over the means and content of communication, will probably occur as part of a larger political process.
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Agency for Change
Theoretical Conceptions of Class
Before we can situate the implications of the trends in American capitalism, we first have to analyze the theoretical nature and role of class. The
historical conception of “class” can be traced as far back as the Greeks.
However, its modern significance and usage arose out of the various theories of the late 18th and early 19th centuries–theories which attempted
to grapple with the emerging industrial order. Two forerunners of Marx,
Saint-Simon and Lorenz Von Stein, both developed quite sophisticated
and intelligent arguments concerning the inception and role of class in
bourgeois-industrial society. Von Stein even developed an intricate theory of class conflict and power. However, it was up to Marx, that great
theoretician and sociological analyst of the 19th century, to provide the
first adequate and comprehensive theory of class, class conflict, and social
change in capitalist society, as well as a generalizable historical model and
theory of such change.
Marx’s conception of class arises out of theory of the history of man
and nature. With the creation of the primitive societies, where the absolute
conditions of scarcity prevailed, comes the birth of man’s struggle with
nature in the form of human labor; his capacity to organize, utilize, and
control the forces of nature leads to the social division of society. The concept of class, then, arises out of human practical activity circumscribed by
the conditions of necessity.1
The growth of the forces of production, which reached a new level
of development with the emergence of the bourgeois-industrial order,
created potentialities for the liberation of men unheard of in conditions
of scarcity. Accordingly, the technical processes and degree of growth influence the changing nature of social relations, and vice versa. Capitalist
society creates two generalized class types: the bourgeoisie and the proletariat.2
The growth and emergence of the bourgeoisie can be traced as far back
as the 15th and 16th centuries. In France, under the monarchy of Louis
XIV, the bourgeoisie was forced to play a secondary role in an alliance
of power with the monarchy. The technical and productive conditions for
their full emergence and realization had, at that time, not been achieved.3
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With the French Revolution the bourgeoisie finally became the ascendant
political power as well as an economic power, through the growth and
consolidation of industrial forms. However, they never expressed a complete, cohesive, unified class interest; this allowed for political struggle
and division, as seen in the events of 1848-52 in France..4
The formulation and life of the proletariat is intimately tied to the
emergence of the bourgeoisie. As a class, the proletariat performs the labor
necessary for the economic growth and progress in industry. In the same
light, however, their labor is alienated: they have a lack of control over
the purpose, use, and direction of their labor; and, equally important, they
see the object of their labor become a thing-in-itself, with which they have
no rapport or creative satisfaction.5 Income differentiation and a money
economy, stimulated by the bourgeois needs of profit and accumulation
and by the social equivalent of the exploitation of human practical activity
and needs become thing-like (reified); the market economy extends these
alienate modes to every sphere of public and private life.6
Conflict, in this general model, arises out of the degree of class consciousness which each class manifests with regard to its practical collective experience. Class consciousness enables a class to formulate the objectives and purposes of this activity; i.e., its class interest. The proletariat
becomes aware of itself as an exploited class; at the same time it becomes
aware of class divisions and aware of the possibility for the liberation of
the whole society by the breaking of its chains. The bourgeoisie, however,
has access to the means of violence and general coercive power. Change,
therefore, becomes a protracted and prolonged struggle.
Marx used this model only as a generalized formulation. When examining an historical situation, such as the events of 1845-52, he saw and
defined the existence of at least seven classes. Each class, though, owed
its existence, at least in a partial sense, to the basic dichotomy between
bourgeoisie and proletariat. The proliferation of classes testified to the incoherent development of class consciousness and the non-idealized, specific character of each society. France in 1848 had a large and significant
peasant class; in fact, this class was the backbone of the seizure of power
by Napoleon.7 The general model, then, must be considered historically
incomplete, but useful in locating the sources of class conflict and tension
in industrial society.
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For Marx, a general definition ensues from this analysis of class.
Class can be defined as the social relations of ownership or non-ownership
(control) over the means of production. Political power is seen as flowing directly from this class situation. The use of the word “ownership”
in conjunction with and as differentiated from control is meaningful, because Marx saw, in analyzing 19th century capitalist societies, that ownership preceded and defined one’s degree of control. The bourgeois man of
power was the entrepreneur who used his position of ownership in order
to better control his area of interest. The State was subservient to private
capital; distinctions between private and public sectors were meaningless.
The point concerning ownership and control is an important one because
the fundamental contemporary critique of Marx’s concept often focuses
on that point.
The Critique of Marx: New Theories of Class
“The relation of succeeding generations to the phenomenon of class
society has been determined to the present day by the doctrine of Marx.”8
This idea, grudgingly admitted by the critics of Marx, has been the central
feature in the discussion of class. All too often, however, Marxian theory
is considered the devil which must be destroyed, and efforts and analysis
seem to develop their validity by demonstrating that, in fact, Marx was
wrong. Analysis then becomes the emasculation of the Marxian concept
of class. A brief survey of various definitions is sufficient to demonstrate
this:
“Class is a force that unites into groups people who differ from
one another, by overriding the differences between them.”9
–­Marshall
“Class, as distinguished from stratum, can well be regarded as
a psychological phenomenon in the fullest sense of the term.
That is, a man’s class is part of his ego; a feeling on his part of
belongingness to something; an identification with something
larger than himself.”10
–Center
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“We shall then mean by social class any portion of a community
which is marked off from the rest, not by limitations arise out of
language, locality, function, or specialization, but primarily by
social statues.”11
–MacIver
“By class is meant two or more order of people who are
believed to be, and are accordingly ranked by the members
of the community, in socially superior and
inferior positions.” 12
–Warner and Lunt
Using their various definitions, these and other writers see certain new
features in industrial organization that cause a fundamental break with
Marxian theory. Primarily, these new factors entail 1) the separation of
ownership and control of the means of production; 2) the procreation of a
managerial elite; 3) the process of social mobility, which in turn 4) develops a new middle sector defined as a middle class; 5) the absence of class
conflict, especially in the United States.
1) This argument was first made by Berle and Means in their book on
the growth of corporate power.13 Their extremely important insight was
that the functions of control now precede and dominate the functions of
ownership in industrial organization. The point is valid and must be used
in any new formulation of class. However, the idea that a separation has
occurred between the two functions is far from exact. As was pointed out
in the preceding section on trends, the functions of control predominate
and directly relate to the rationalization of capitalism. Statistics, however, demonstrate that ownership is still integral and performs coordinating
functions in the process of control.14 Control is exercised for the purposes
of ownership.
2) The discussion of the managerial elite is related to the economic
and social development.15 The chief exponent of this theory, James Burnham, posits the existence of a “particularly small group of men that control the chief instruments of production.”16 The central thesis also rests on
the arguments concerning the separation of ownership and control. If the
capitalist relations of production still exist, as Burnham admits, then the
theory of the managerial revolution simply implies the fact that recent de-
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velopments in capitalism have created the need within the ruling class for
technical and managerial roles.17
3 & 4) Theories of social mobility and the new middle class abound
in the United States. This theory, which can be derived in large part from
the work of Lipset and Bendix,18 has been adequately dealt with in two
of C. W. Mills’ works, White Collar and The Power Elite. The arguments
of social mobility are related to the pluralist conceptions of divisions and
harmony in the U.S. As such, it will be discussed in the next chapter of this
paper. Interestingly enough, only in the U.S., where the end of ideology
is the modus vivendi of social analysis, have theories of social mobility
maintained such crucial significance.
5) The absence of class conflict does not necessarily deny the existence and formulation of classes. As Ralf Dahrendorf, a most un-Marxist
sociologist of class, has pointed out, class conflict and consciousness have
both manifest and latent tendencies. Two things then emerge; first, if there
is an absence of conflict, one must study the underlying and structural reasons for such a fact; secondly, and even more important, one must study
the new role and differentiation of classes that emerge in the development
of modern kinds of structures and controls under capitalism.
The development of these new theories on class point out, however,
though in an extremely partial way, new developments in class relations
in modern capitalist society. Our task is to make certain changes in the
general theoretical model and to study the specific situations in American
society, using the general model as a point of departure.
A Tentative Theoretical Model for Class Analysis
As implied in the previous section, a definition of class must now
include the social relations involving the control or non-control over the
means of production. Ownership, although now occupying a secondary
role, is still an integral part of control and the definition of class.
A second additional feature of the general model is that the control
or non-control over productive forces is related to and must include the
control or non-control over the quality of one’s life. As pointed out in
the chapter on communications, American corporate capitalism creates the
conditions for compulsive consumption. This model of consumption is the
other side of alienated labor: both, in describing an alienated existence,
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form and integral whole which reinforces the separate parts.19 This notion
becomes a generalized formulation of the crucial and central mode d’ existence of an organized corporate capitalism whose arm extends to every
section of the subjugated population. It is a useful point of departure in
analysis of American class society.
American Society and the Debate over Class
If a democratic society is to survive–and by that I mean
simply the principle of toleration among groups–then some
new sense of civil obligation must rise that will be strong
enough to command the allegiance of all groups and provide
a principle of equity in the distribution of the reward and
privileges of society.20
– Daniel Bell
The men of the higher circles are not representative men;
their high position is not a result of moral virtue; their
fabulous success is not firmly connected with meritorious
ability. Those who sit in the seats of the high and the
mighty are selected and formed by the means of power,
the sources of wealth, the mechanics of celebrity, which
prevail in their society. They are not men held in responsible
check by a plurality of the pinnacles of decision. Commanders
of power unequaled in human history, they have succeeded
within the American system of organized irresponsibility.21
–C. Wright Mills
Dissecting Pluralism
The theory of social organization, structure, and power that has dominated since 1945 American social science and most general analyses of
American society has been pluralism. The pluralist formulation can be
roughly broken down into two general areas; the theory of countervailing
powers and the theory of social mobility and the expanded middle class.
The concept of countervailing powers was first used by John Galbraith in his explanation of the mechanisms of power and decision-making
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in American capitalism.22 Galbraith argues that the large corporate-like
units of power, big farmers, big labor, big business, and big government,
all maintain and push for their own sets of interests. Their interests are
defined by the area of their operation. Secondary sources of power such as
church groups, small businesses, and certain voluntary associations equally push for their interests. These contending interests balance and modify
each other in the arena of political decision-making, whether in the formal
or the informal processes that relate to power.
Thus no one group maintains power in and for itself. The system
evolves around and changes according to a modern checks and balances.
Other pluralist writers, such as Robert Dahl in his book Who Governs?,
extended Galbraith’s argument to include the process of power and politics on the local community level. Class society is ultimately no more than
group division defined by different self-interests; sources of power have
nothing to do with class structure.
Even this differentiation, the pluralists maintain, is no longer completely applicable. With the growth of technology plus the availability of
education to all sectors of the population, social mobility is on the rise.
Class (income and/or status) distinctions are ebbing away into the great
equalizing melting pot of middle-class America.
Interestingly enough, both arguments contain partial truths, although
not in their definitions of class. To a certain degree, American capitalism
has desired and obtained the integration of at least the formal organizations of various groups into a national pattern of acceptance (submission)
and faith (false consciousness) in the ideology of corporate capitalism.
Whether it be, in specific, the labor bureaucracy, or, in general, the grand
coalition of the Democratic Party, capitalism has succeeded in defining the
priorities and objectives of most social groups in terms of its own needs.
Integration is an essential feature of modern capitalist development:
thus the partial truth of the theory of countervailing powers. What is obviously lacking is the simplest understanding of the sources and nature of
power in America. This can be observed in any context: in terms of the
concentration of means of wealth and control (the economic order); the
frivolity and inadequacy of legislative debate and the nature of corporate
liberalism (the political order); or the manipulations in context and the
structural confluence of interest in communications (the social order). Any
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one of these analyses will come to a conception of power in terms of class
role and degree of control.
The arguments of social mobility equally contain a partial truth. While
the creation of educational opportunities has increased in America, these
opportunities are directly tied to the needs of a highly advanced capitalist
system for more technical and professional jobs.23 However, these jobs are
not jobs that entail control over the processes and organization of production. The sources of power are not altered but reinforced by those technical rationalizations. While this new group might enjoy greater benefits
(higher income, greater educational training), they still remain in a position of class exploitation (non-control over production and the quality of
their lives). If this group does belong to a growing middle sector, that does
not mean an all-pervasive growth of a new middle class; on the contrary,
it implies the emergence of a new working class.
The other positions in this middle sector (clerical workers, sales and
promotions, etc) are, by any stretch of the imagination, far from being
even close to the centers of power. Those jobs, as Mills pointed out in
White Collar, can be considered still more exploitative than those of the
traditional working class.
What we have, then, is a theory of social mobility which is not class
mobility, and a new middle class which is not a class. The whole of the
pluralist arguments seems to refer to something which is not.
Although no cohesive and cogent theory and analysis of class structure in American society has been developed using a Marxist model as a
point of departure, that does not, as Daniel Bell as posited, mean there is
an end to critical ideology and class consciousness in America, and the
agencies for such change has been the unwillingness of the American left
to come to grips with the general theory of class and the specifics of America society.
The problem has not fled, as the pluralists imply; we and they have
only fled from the problem.
American Class Society and its Agencies for Change
Let the old men ask sourly, “Out of Apathy–into what?” The Age
of Complacency is ending. Let the old women complain wisely
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about “the end of ideology.” We are beginning to move again.24
–C. Wright Mills
The emergence of a new student and civil rights movement in the late
‘50’s and early ‘60’s has raised again the question of agencies for social
change, and even the idea of change itself, absent in America since the
entrenchment of the Cold War, ca. 1948, with the defeat of Wallace. The
inability to link the discussion of agency to the question of the radicalization of class groups has produced sterility in the analysis and a vacuum in
the formulation of long-range and even intermediate strategies. The conclusion of this document will attempt to deal with both aspects of this
problem, namely:
1) the discussion of a long-range potential and strategy in the light of
a class analysis, in the context of the description and trends in America
corporate capitalism; and
2) the discussion of intermediate goals, strategies, and problems coming out of an analysis of what groups are presently in flux and why. The
long-range analysis will entail an enumeration of the present class groups–
including their own differentiation–and the various potentials they contain
within themselves.
Class Structure and Class as Agency
The four major class groups posited in an analysis of American society
are 1) a ruling or bourgeois-capitalist class, 2) a petty bourgeoisie, 3) a
working class (including a middle sector as well as the new and traditional
working -class groups), and 4) an underclass. Each class group will be
examined in and for itself as well as through its differentiations and noncohesive nature.
1) The Ruling Class
The ruling class, that oft-misused, oft-criticized concept, refers, in this
context, to those in control–primarily over the forces of production–who
have access to the means of power in this society. Since this class-group,
like the others, does not entail a cohesive and unified whole, some sort of
breakdown of their group is necessary.
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The Higher Ruling Class
This refers to the managers, administrative and technocrats who have
direct and total control over their areas of production and influence. Therefore, those who maintain ideological control–presidents and high administrators of large universities, foundation heads, the executive and managers
of the mega-corporations which dominate and extend into every area of
institutional life and power in America, are the key components. Power
and control cover many areas in an advanced industrial society. Therefore,
members of a higher ruling class must also include the key officials in the
public, governmental posts, as well as the ideological officials of communications.
The Sub-Ruling Class
This group refers to the lower levels of power and control; primarily
professionals (most Congressmen, state and city officials, lawyers, etc.)
as well as lower level technical and managerial elites. These individuals
by and large constitute the groups of middle-range directors in the corporations and public bodies. As such, they have access to power, but only
on this middle-level in the functioning of America capitalism. They exert
control, but not in the primary areas of production.
As might be guessed, the ruling class does not constitute a bloc for
radical social change; they, in fact, prevent it. However, even within a
ruling class policy decisions can cause conflict and division. The War in
Vietnam is a case in point. Certain more obvious dislocations and irrationalities in the American political and economic structure could feasibly
produce severe discussion within the ranks of the ruling class. Dissension,
however, is not the trend, but, conversely, a movement towards rationalization and integration seems on the rise.
2) The Petty Bourgeoisie
This class refers to the small proprietors, middle-range farm owners,
and general group of small businessmen (J.C.’s, etc.). Their distinction
from the ruling class is that they are almost completely removed from
sources of corporate and ruling class power and control. Their distinction
from the working class is a result of some control over their limited area of
work; i.e., they own their business no matter how insignificant it may be.
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During the 19th, and on through the early part of the 20th century,
the petty bourgeoisie constituted an important political bloc. The demise
of both the Progressive party and the spirit of anti-trust, combined with
the petty bourgeoisie’s increasing economic irrelevancy, destroyed their
last vestiges of class cohesiveness and political importance. The death of
the market economy, their ideological raison d’etre, has resulted, among
some of the petty bourgeoisie, in an affinity with the Goldwater conservative faith. However, their gradual development toward impotency and
their lack of extended control, creates a possible (though quite distant from
immediate realization) identification with the aspirations of the working
class, if and when a working class would develop demands for control
over their own lives and over the organization of society.
3) The Working Class:
Sleeping and Cumbersome Giant
This is the most prevalent of those misused and abused terms. The
term has been used with romantic fervor and ill-tempered disdain. It has
been made the all-inclusive, all-knowing, totally coherent mass subdued
by a few choice bureaucrats, or else, has been posited out of existence. As
agency, it has been thought of as with the restless titan, waiting, subdued,
ready to strike like lightning a the heart of the capitalist monster, or else as
an invisible mass, so thoroughly integrated into society that it would never
again raise its ugly head to threaten the balance and harmony of societal
organization.
Both conceptualizations do not describe the changing nature of the
labor force to accommodate the changing technical, structural nature of
industrial organization and the general growth of social service positions.
This change has brought about the differentiation and lack of cohesiveness
within the working class. It has also created new and important structural
roles that make it even more crucial to the maintenance and functioning of
American capitalism.
The alternate concepts of revolutionary potential and integration are
useful in seeing two alternative modes of working class life in America.
Both, by themselves are inadequate given new working class conditions.
Revolutionary potential has to be totally redefined in the contemporary
American (and European) context. The revolutionary slogans of the de-
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pression years are no longer applicable today. The formulation of revolutionary potential is still only used with regard to the traditional industrial
workers, from which whole new groups of workers, who, in fact, form
the possible vanguard, are excluded. Working class integration, on the
other hand, must be seen in light of its artificial and forced (manipulative) nature. Genuine integrative consensus is possible only if the roots of
class division are eliminated. All too often, this simple truth is neglected
in modern theories of integration.
For the analysis, this non-cohesive and changing American working
class will be subdivided into three main groupings; new working class,
middle sector, and traditional working class. Each, in turn, will be further
subdivided. Estimates of their composition of the labor force are roughly:
new working class, 13% (and growing); middle sector, 32.1%; and traditional blue-collar working class, 36.2% (diminishing).25
New Working Class
This group can be broken down into three pivotal areas: First, technical and professional (e.g., engineer types) workers whose essential situation is one of non-control yet proximity to the means of production; secondly, higher-level industrial workers (Chemical, metallurgical, atomic,
and even some auto workers, etc.) whose distinction from the blue-collar
industrial workers involves the degree of educational and technical training and resulting specialization; thirdly, social service workers (teachers,
doctors, social workers, creative and performing artists, etc.) whose role
will increase with further rationalization of capitalism and the introduction
of welfare-state measures. Their high degree of education background,
greater income levels and status, and the structurally crucial role they
play in societal organization and development, are unifying aspect of the
new working class.
Most university students who join the labor force will enter into one of
these three areas of work. Therefore, both the socializing role of the university and its work-apprenticeship program are crucial to the integration
and stabilization of thee groups. At the same time, the greater flexibility
and more open nature of the university experience combined with the fact
that the university is the one area where a potential radicalizing process
now exists, allows for the immediate possibility of the radicalization of
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those groups. Thus can be seen, in particular, with respect to the social
service workers, where the emergence of a new student left has instilled a
note of radicalism in the teaching and social work professions. Their job
experience (in the schools and ghettos) not only enables them to see the
contradictions in the society, but allows them to formulate the theoretical
guidelines for radical action.
The present non-radical nature of the technical and highly-skilled
workers testifies, in part, to the inadequate strength and program of this
new student left. However, in England, France, and West Germany, where
working conditions are not so different from those of the United States, one
can see the emergence of radicalism within those groups. In England, the
concept of workers control was first introduced by the technicians union
(ASSET). In France and West Germany, the chemical and metallurgical
unions are in the forefront in the formulation of demands for control. Interestingly enough, the German SDS has had striking success in developing
contacts with these highly specialized workers. While these developments
are absent in the U.S. (although the air-mechanics strike is indicative for
the possible adoption of radical programs) the potential is always present
and could emerge in the future.
The overriding feature, then, of the new working class, is that they
are at the very heart of production in such a way as to be conscious of
the role and nature of the social organization of production and yet unable to control it. They could have an immediate stake in radical social
change. Many of the jobs of the new working class (excluding social service workers) are, in some part, related to defense production. At times,
workers press for a continuation of this production in order to preserve
their means of livelihood. In an immediate context these groups seem to
support and sustain the irrationalities of the system; as such, the New Left
writes them off as agency for change. But the new left must translate their
socio-economic, political, and cultural critique, which, in part, could lay
bare the tools of imperialism and waste (defense) production, to the workers’ lack of control over their very means of livelihood. It is precisely the
nature of the work experience that can result in radical critique. The role of
waste production does not destroy the potential for radicalization; it only
reinforces it. It also points out the crucial vanguard role the social service
workers, (including the New Left students) most in flux and least tied to
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Revolutionary Youth & the New Working Class
defense production, must play in organizing and radicalizing the growing
new working class.
The Middle Sector
This group is the most incoherent and differentiated part of the labor force. Its defining characteristics are, on the one hand, (distinguished
from the new working class) the inadequacy of educational and training
backgrounds for their own job skills, and on the other, (distinguished from
the traditional working class) the non-industrial, non-blue-collar nature of
their work. The middle sector can be subdivided roughly into two groups:
first, those that exist, partially or totally, because of the surplus – clerical,
sales, advertising and promotion, and general bureaucratic workers – as
nonproductive consumers; secondly, non-domestic service workers who
do not need advanced educational training skills–transportation workers,
cab drivers, certain hospital workers, etc. These workers consider themselves part of a middle class, for reasons of status and the non-industrial
nature of their work. They are potential radicals for a number of reasons
besides the over-riding one of the lack of control over their work life):
first, the nature of their work is utterly useless to the production and fulfillment of social needs. [Ed. Note: this refers to the first group, such as
advertising workers.] They are directly tied (related to the surplus) to the
needs of compulsive consumption, from which they could see the irrational and exploitative nature of social organization. Like the defense workers, they can form the immediate basis for reaction in that their means of
livelihood is defined by irrationality. However, their lack of control, plus
their ultimately useless and degrading positions imply a potentially critical
framework. The manipulation in the work experience in a context of nonproductive labor, could enable them to develop a class critique.
Once again, the task of a New Left is to make their social critique
relevant to this group’s work experience. Secondly, with the process of
automation making serious, though incomplete, inroads in middle sector
production, the possibility of confrontation increases. While confrontation
might not lead to radical conclusion, it opens up an area for radical program and strategy. (This can be seen in the NY transit strike, one of whose
root causes was the introduction of automation.) The New Left must realize that the middle sector is in a state of flux, in such a way that it can
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become open to future long-range radicalization.
The Traditional Working Class
The traditional working class, the revered proletariat, has failed to deliver the revolutionary blow that the American old left had so ardently
desired and so totally ritualized. Instead, it has become tied, through the
media of its bureaucratic organization, the AFL-CIO, to the ideological
mainstream of American society. Radical socialist incantation and disillusionment has predominantly concerned this class group. The New Left,
on the other hand, has dismissed it as a potential agency; an attitude reinforced whenever George Meany waggles his cigar and defends American
capitalism, even in its most irrational spheres.
However, 36.2% of the labor force cannot simply be dismissed. The
same lack of control, powerlessness, and degrading life-styles applies to
them as well as to everyone else exploited in a class society. Also, two new
factors have been added to the picture.
First, in the last six years (1960-66) there has been an absolute rise (in
quantity and by percentage) in the number of industrial strikes.26 While statistics on the nature of the strikes do not point to any one single trend, factors of job security, plant reorganization, and non-wage benefits–i.e., those
concerning the quality of and control over one’s livelihood–are becoming
increasingly important. The major distinction between wage disputes and
disputes concerning claims for security and control must be understood:
“Wage claims are more frequently motivated by rebellion against
working conditions than by a revolt against the economic burden of exploitation born by labor. They express a demand for as much money as
possible to pay for the life wasted, the time lost, the freedom alienated,
in working under these conditions. The workers insist on being paid as
much as possible, not because they put wages (money and what it can buy)
above everything else but because Trade Union action being what it is at
present, workers can fight the employer only for the price of their labor,
not for control of the conditions and content of their work.” 27
The absolute increase in the number of strikes, plus the introduction
of non-wage claims that could lead to the demands of control, are a significantly important dimension in the direction of the working class. These
strikes are also tied to the rate of the introduction of automation, which is
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Revolutionary Youth & the New Working Class
directly tied to the control of one’s work experience.
Secondly, an increasing number of strains and tensions have developed
within the AFL-CIO, because of both its reactionary-bureaucratic development and its increasing irrelevance to the working population.28 Certain
new potentials could come out of this situation. First, an increasing split
within the organization could lead to an eventual withdrawal of some of its
member unions. This in turn, would create a situation where radicals could
find breathing space within union structures and where the functioning
and the strength of the unions’ role of integration could be challenged and
hampered. Also, an irrelevant AFL-CIO would allow space for the creation
of new working-class organizational forms that could include strategies
and demands for workers’ control, plus a general radical plan for societal
re-organization. This point is valid especially when one includes the new
working class and the middle sector workers. The general situation of the
working population is one of both flux and stagnancy: flux in the sense
that the nature of the labor force is changing; stagnancy in the sense that
the old forms of working-class organization have remained the same.
Certain groups within the working class are receiving higher levels
of technical training. But greater technical responsibility is disconnected
from control over the conditions to of work. The company demands that
imagination on job and passive submission to the discipline and standards
prescribed by the management.”29 This is the central contradiction in the
nature of work in contemporary society; also, this can lead to the creation
of radical demands for control–demands that can link the working class
with that most economically deprived group–the underclass.
The Underclass
The underclass is an integral part, if not a part of the vanguard, of the
potential movement for social change. The underclass roughly refers to
two groups: the black and other racial minorities, and the permanently
unemployed and underemployed. The black minority has become the permanent bottom level of the American social structure. Sharing this bottom
level with the black population are units of the population which have
been place in positions of unemployment and underemployment. That
which unites the class as a whole is its deprivation: economic deprivation
(near-starvation levels of income); social deprivation (the insidious con-
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trol over their lives exercised by other groups and the denial to them even
of the minimal forms of human dignity); cultural deprivation (the manipulative imposition of an outside culture); and political deprivation (absence
of political representation and general powerlessness.)
The underclass is the most deprived class in America; as such, it has been,
is, and will be one of the centers of radicalism in this country. But itself it can at
most be only a disruptionist force (the Watts riots, etc.). But, as a source of radicalism, it has been the first to bring forth demands for control and radical change.
As a class, it can be checked and isolated when acting by itself because, despite
its exploitation and indigent radicalism, it is still removed from the sources of
power–the centers of production. It must thus develop alliances with the working class, with the radical demand of control as the unifying factor. This alliance
is the basis of the total agency for change. The development of this alliance is
far from its realization in the immediate context of American society; it needs
intermediate strategies as well as a greater sense and purpose to radical program.
This alliance could be nipped in the bud, or could be threatened by problems,
this alliance remains the only hope for changing an irrational, unjust, and violent
society into a society where free men could develop and fulfill their human creative needs within a peaceful, socialist, and humane world.
Praxis
The Concept of Praxis
Praxis can first be defined as the development of consciousness
through relations to production. Through that process theories of society,
of class, and of man’s relations to man and nature gradually develop and
then reflect back on men’s human practical activity. Knowledge comes
from activity and in turn affects and shapes that activity. This knowledge
becomes political consciousness when it develops out of the class relations
of production. Therefore, class consciousness is the highest form of political consciousness. Class-in-itself (in terms of its relation to the means
of production) becomes class-for-itself (consciousness of its political and
historical role). In Marx’s conceptualization the industrial working class
contains the seed of the final expression of praxis (class consciousness).
Praxis is usually defined as the unity of theory and practice. All too
often the use of this definition leads to a static formulation of praxis and
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Revolutionary Youth & the New Working Class
a static strategy for social change. What is absent is both historical understanding and an understanding of emerging and potential contradictions
in society.
“The unity of theory and practice is also not a given mechanical fact
but an historical process of becoming.”1 This implies critical analysis of
the social situation concomitant with social activity. Briefly, praxis is
“practical-critical activity.”2
Central to understanding praxis is the concept of the different levels
of praxis as well as understanding praxis in its totality, that is, total revolutionary praxis.3 All too often this isolation of one level of praxis leads
to an undue emphasis on the economic level of production, with a purely mechanical understanding of the relation of base and superstructure.
Therefore, this relation is translated as one-to-one relations, inhibiting
understanding of the subtle and significant changes in the superstructure
(political, cultural, and social developments) which in turn reflect on the
development of the base (economic structure).
This is an historically important form of partial praxis. In the Soviet
Union there was an undue reliance on developing heavy industry as the
means whereby socialism would be created. In the United States the American Communist Party and other elements of the old left relied on the Soviet
model, which obscured important specific features of American society, and
they refused to recognize the flexibility of American capitalism.
The form of partial praxis more relevant to the new left is its inability
to develop a social praxis that come of its class relations to production.
These relations are perceived as ambiguous by students who are not yet
integral components of the new working class, as formulated in the section
on Trends. This situation implies a lack of definition of their own class
role. This lack can first be seen as the new left’s inability to define the new
changes and new potentials in society which is also intimately related to
the inability of the new working class to develop consciousness as a classfor-itself. The failure to perceive their class relations inhibits the development of total revolutionary theory, which in turn inhibits the development
of class consciousness. In this light, total revolutionary praxis involves
recognition of their structural, technical role in maintaining, developing,
and rationalizing American capitalism, and therefore of their own power
as a force for social change.
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Praxis and the New Left
The new left’s inability to understand its potential class role comes
partly from the fact that students qua students do not constitute a classin-itself. The university experience does not describe, by itself, class relations of production. It has primarily two functions: first, as a socializing
mechanism that is used to integrate and stabilize various social groups into
society; and secondly, as an apprenticeship for the new technically specialized economic functions of the society.
The apprenticeship also includes liberal arts studies, since as the Rockefeller Reports implied, the rapidly changing nature of economic tasks
requires a more flexible training program. Liberal arts education is also
part of the requirements caused by the proliferation of social and administrative tasks, itself a result of the process of the new technology. The
protest at the university level relates primarily to the first function of education (socializing mechanism) rather than to the class-related function of
apprenticeship. However, the new left’s origins do not rest simply with its
present social condition, but go back to the protest concerning civil rights
and peace.
The origins of the new left are not based on an ideological (class)
confrontation but, on the contrary, emanate from a serious commitment
to certain features of the dominant American ideology. The denial of civil
rights to the black population was the first issue that led to the emergence
of the new left. The exposure of this denial directly contradicted the dominant rhetoric of equal opportunity and democratic rights. The movement
that resulted was oriented toward ameliorating these specific evils rather
than toward developing programs that included a structural critique of the
whole society. The call for integration was the call of the elimination of
some apparently irrational features of American capitalism, namely, the
arms race and the existence of poverty amid affluence. Again, the critique
and program were oriented toward the elimination of specific programs
within the context of a class society.
However, the protest movement led to a gradual recognition of the
nature of powerlessness and produced that oft-quoted ideal: People should
make the decisions that affect their lives. This pervasive state of powerlessness enabled some to grasp the correlation between activity in the
rural South or the urban North and relations of this country to the under-
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developed nations. The protest movement could then move on to a higher
level of critique, in particular concerning the two specific problems of the
universities and the war in Vietnam.
In the winter of 1964 the Berkeley revolt occurred. The studies on the
nature of this revolt point to and give evidence to the thesis that the protest
movement developed in response to the contradiction between the American ideology and its reality, rather than as a rejection of this ideology. Glen
Lyon’s study shows that a large plurality of students participating in demonstrations for the first time considered themselves Liberal Democrats,
whose position represents the idealized formulation of American ideology.
However, this plurality was sharply reduced among students who had previously participated in demonstrations.4 Participation in the protest movements did result in a partial radicalization.
Involvement in the Vietnam protest has furthered that process in several different ways. First, the very centers of power are clearly implicated
in waging this war. This implies a qualitative difference from the civil
rights situation, where, in fact, President Johnson could say, “We shall
overcome,” and where the Federal Government was not recognized as directly obstructing civil rights. Secondly, Vietnam led to theories with the
beginnings of a critique of imperialism. Thirdly, Vietnam has raided the
question of priorities in the allocation of resources especially affecting
poverty and education. Fourthly, Vietnam clearly revealed the processes
of manipulation and consensus instrumental to maintaining the dominant
ideology. However, Vietnam, in itself, has not clearly demonstrated the
nature of class society, particularly in respect to the new working class.
The war protest has not brought forth the specific structural programs for
social transformation.
The protest on the university level has further developed student consciousness to the point where the new left began to formulate a partial
praxis. Instead of just responding to specific irrationalities, the new left
began to construct a social-political theory out of its experiences; i.e., a
praxis. Significantly, the new left started talking about control and manipulation. This emphasis was a response to the socializing mechanisms of
the university, which involve such things as in loco parentis, objectification and quantification of the learning experience (also part of apprenticeship), and the pervasiveness of the “legitimate” institutions that occur
Lost Writings of SDS
121
in society at large, such as paternalism in poor communities and expertise in
foreign policy. Although these issues did, in part, spring from the civil rights
movement, they grew more refined and recognizable within the context of
the university, both to the new left and to a greater number of students.
Another aspect of the developing social theory was the concept of
decentralization. The new left, itself a product of post-scarcity economy,
with its potentials, began to articulate the need for and the new possibilities of real democratic control through the processes of decentralized decision-making. The new student left’s awareness of a post-scarcity situation
comes from a lack of economic compulsion. Their own leisure enabled
them to conceptualize men freed from centralized organization imperatives, which in turn would allow men to deal with the processes and decisions that shape their lives.
The new left, then, has moved from single-issue protest to an embryonic political theory whose two new features are the concepts of control
and decentralization. These concepts are directly tied to recent developments in American capitalism. A new working class, whose formulation
occurs within the university, has been developed to meet the needs of the
skilled positions created by technology. The demand for control is crucial
to the very self-conception of this group, at work and in its life-style. Also,
the development of the conditions allowing for a post-scarcity economy
provides the potential for decentralization. The new student left, however,
has not yet experienced those demands in class terms, i.e., in terms of their
relationship (as student trainees) to the new working class.
Prospects for the New Left,
the New Working Class, and America
The prospects for the new left revolve around its distinction between
class and status, both in the ways it defines itself and the possibility for
change. The present theory for social change, implicit in new left activity,5
is that groups (strata) outside society, because of their role as outcasts are
not central to the mechanisms of production, have least to lose and most to
gain in changing society. They, therefore, are invulnerable to co-optation.
In fact, this position is most vulnerable to co-optation.
First, the student sense of alienation results from the social organization in the application of the new technology. Under capitalism, these
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increasing productive powers tend to growing waste production and, at
the same time, develop mechanisms of control which leave the individual
(student) with loss control over the now more complicated processes of
production. Students find themselves in a situation where they have become socially necessary for the functioning of the economic system, but
their economic functions have little or no real social value. Added to this
are the cultural and social manipulations they experience, which have been
made more remote by the development of technology.
Secondly, for the black population the converse holds true. Their economic functions, or non-functions, involve real work related to a subsistence economy, but are being made socially unnecessary by technological
advances. They share with students the sense of powerlessness that arises
in part from cultural and social manipulations.
These forms of alienation are insufficient by themselves to form the
basis of a viable radical movement. Both groups, though not necessarily, can be co-opted or relegated to irrelevance. The underclass can be
rendered ineffective either through a process of sharing economic gains
(greater expansion of social welfare measures) or through their gradual
absorption by the ever-increasing growth of the middle sector.6 Although
this co-optation might not necessarily occur, given a certain rationalization
of American capitalism and its continued ability to expand, this tendency
becomes a real possibility.
The potentiality for new developments in rationalizing American capitalism (economic planning, rationalization, greater equalization of income,
full-employment practice–the Welfare State model) is directly tied to the
potential of co-opting students, alienated by waste production and powerlessness, by enabling them to become the future rational technocrats. This
role provides for a greater sense of power, specifically in dealing with the
surface dislocations in American capitalism. Clark Kerr, one of the prime
advocates of the new technocracy, was, after all, a member of the Student
League for Industrial Democracy, the predecessor to SDS. Bobby Kennedy, the symbol of rational capitalism, has remarked the SDS types will
make the imaginative administrators for future governmental posts.
The other side of co-optation is the indigenous aspects of romanticism and reformism (the politics of protest) within the new left. The politics of protest derives from the lack of class politics and the tendency for
Lost Writings of SDS
123
the new left to look at itself as a status group outside of a class position
and role. Romanticism comes from certain material comforts as students,
which are potentially always available, as opposed to a situation where
one’s livelihood is at stake. However, it is their very livelihood (the future
technical positions) that can provide the basis for class politics based on
the programs of control and participation. Therefore, the very forces for
co-optation also provide for the development of a new class consciousness
with a power to make structural changes in society. This power can only
develop through a new and high level of praxis; one which recognizes the
possibility of class consciousness in the new working class.
Any revolutionary theory based on the strategic importance of the new
working class must also recognize the dangers of reformism inherent in
this class’s economic well-being. Lucien Goldmann has pointed out that
demands of control and participation can be neutralized, so that a revolutionary theory must always contain the cultural and social critiques of
societal manipulations, as for example, those contained in the works of
Herbert Marcuse. Further, this critique must always rely on a structural
analysis of capitalism, including a critique of imperialism. Finally, this
critique must include an international perspective; with the problems of
world capitalism, and the development of socialist activity throughout the
world.
The new left, in its development of a partial praxis, has within itself
the possibility of co-optation or absorption through the developing aspects
of American capitalism; however, it also contains the seeds of a total revolutionary praxis with the potential for transforming American society from
top to bottom, into a society where “the free development of each is the
condition for the free development of all.” (Karl Marx, The Communist
Manifesto)
Footnotes
Part 1: Description
1 David Michaels, “Monopoly in the United States”, Monthly Review, April, 1966, p,
48.
2 Richard Barber, “The New Partnership–Big Business and Big Government”, New Republic, August 16, 1966, pp. 17-22.
3 Ibid., pp. 17-22.
4 U.S. Department of Commerce and Labor figures, cited in Looking Forward, prepared
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Revolutionary Youth & the New Working Class
by the AFL-CIO Research Department, p.7.
5 Harvey Kolver, The New Math in Labor Relations”, Monthly Review, May 1966, p.
17. His course is the President’s Economic Report, January 27, 1966.
6 Gabriel Kolko, Wealth and Power in America, pp. 16-20.
7 Adolph A. Berle, The American Economic Republic, p. 50.
8 Barber, op. cit., pp. 17-22.
8a David Braselton, The Paper Economy, p. 337.
9 Kolko, op. cit., p. 57.
10 Ibid., p. 59.
11 Michaels, op. cit., p. 49. His source is the U.S. Senate, Hearings Before the Subcomittee Anti-Trust and Monopoly: Economic Concentration.
10 U.S. Bureau of the Census, Statistical Abstract of the U.S., 1966, p. 501.
12 Barber, op. cit.
13 Raymond Williams, Communications, p. 9.
14 Forbes, January 1, 1967, p. 121.
15 Seymour Melman, Our Depleted Society, p. 316.
16 Victor Perlo, Militarism & Industry, p. 169, his figures are taken from the companies
own reports.
17 New York Times, December 23, 1966.
18 Melman, op. cit., p. 315.
19 New York Times, op. cit.
20 Forbes, op. cit., pp. 121-2.
21 Melman, op. cit., p. 335.
22 Forbes, op. cit., pp. 121-2.
23 Melman, op. cit., p. 314.
24 Perlo, op. cit., p 190.
25 Forbes, op. cit., p. 118.
26 Fritz Machlup, The Production and Distribution of Knowledge in the U.S., p. 265.
27 Ibid., p. 269.
28 Robert Engler, The Politics of Oil, p. 265.
29 Fred Cook, “Their Men in Washington”, The Nation, March 30,1964, p. [x?].
30 Machlup, op. cit., p. 84.
31 Columbia University, Financial Report, 1963-64.
32 Melman, op. cit., p. 340-2.
33 Columbia, op. cit.
34 Sharon Krebs and Ed Lemansky, “Colombia University: A Political Monograph”, Free
Student, #3. Their sources are Poor’s Directory of Corporations, Executives and Directors and Who’s Who in America.
35 Harold Orlands, The Effects of Federal Programs on Higher Education, pp. 93-7.
36 Robert Morisson, “Foundations and Universities”, DAEDALUS, Fall 1964,, pp. 11101131.
37 Machlup, op. cit., p. 82.
38 Orlands, op. cit., p. 100.
39 c.f., New York Times, October 10, 1966.
40 c.f., Edgar Friedenberg, Coming of Age in America.
41 Andre Gorz, “Work and Consumption” (from Strategic Ouvriereiet la Neo-Capitalism) in Perry Anderson, ed., Toward Socialism, p. 246.
42 e.g., David Riesman, The Lonely Crowd, and W.H. Whyte The Organization Man.
43 c.f., Herbert Marcuse, One-Dimensional Man, the section on one-dimensinal thought,
chs. 5-7.
44 Gorz, op. cit., p. 349.
45 c.f., Andres Kopkind, The B+ Congress”, New Republic.
46 c.f., Harry Magdoff, The Problems of U.S. Capitalism”, in Ralph Miliband and John
Saville, eds., The Socialist Register, 1965, pp. 62-79.
47 Richard Titmuss, “The Limitations of the Welfare State”, in Anderson, op. cit., 359.
48 c.f., Rockefeller Panel Reports, Prospect for America, pp. 346-9.
49 c.f., C. Wright Mills, Power Elite
Lost Writings of SDS
125
50 Adolph Berle and Gardiner Moans, The Modern Corporation and Private Property, p.
356.
51 Kolko, op., cit., p. 57.
51a Historical Statistics of the United States, p. 73.
51b Paul Baran and Paul Sweezy, Monopoly Capitalism, p. 247.
51c William Appleman Williams, Contours of American History, p. 448.
52 Kolko, op. cit., p. 39.
53 Rockefeller Panel Reports, op. cit., p. 202.
54 Harry Magdoff, “Economic Aspects of U.S. Imperialism”, in Monthly Review, November, 1966, pp.14-15.
55 Ibid., p. 17.
56 Ibid., p. 20.
57 Ibid., p. 19.
58 This estimate involved taking Magdoff’s 40% as a maximum and getting a 25% minimum by adding exports as a percent of domestic moveable good (9%) to an index
of foreign owned production, expenditures on plant equipment, on 17.3% of such
domestic expenditures.
59 Magdoff, op. cit., “Imperialism”, p. 39.
60 Statistical Abstract, op. cit., p. 868.
61 Cited in Magdoff, “Imperialism”, op. cit., p. 37.
62 Cited in Edie Black: “A New Look Into U.S. Investments in Latin America”, Christianity and Revolution, Nov., 1966.
63 Statistical Abstract, op. cit., pp. 865, 863.
64 U.S. Bureau of the Mines, International Petroleum Quarterly, computed from figures
on pp.2-3.
65 New York Times, chart, January 9, 1967, p. 120.
66 c.f., David Horowitz, “The Alliance for Progress”, in Ralph Miliband and John Saville,
ed.\s, The Socialist Register, 1964, pp. 130 & 138.
67 ibid, p. 130. Cites Howard Rusk of the President’s “Clay Committee”, in NYT, April
5, 1963.
68 Magdoff, “Capitalism”, op. cit., p. 120.
69 Magdoff, “Imperialism”, op. cit., p. 24-7.
70 Perle, op. cit., p. 72.
71 Statistical Abstract, op. cit., p. 859.
72 Kwame Nkrumah, Neo-Colonialism, the Last Stage of Imperialism, p. 10.
73 Horowitz, op. cit., p. 137.
74 John Gerassi, The Great Fear in Latin America, pp. 275-6.
75 c.f., ibid, p. 265-6.
76 c.f., Black, op.cit., for more thorough discussion.
77 Melman, op.cit., pp. 250-1.
78 Gerassi, op.cit., p. 311.
79 Paul Baran, The Political Economy of Growth, p. 256.
80 Gerassi, op.cit., pp. 117-122, 361-366.
81 Engineering and Mining Journal, November, 1964, cited in James Petras and Allen
Young, “Labor in Chile”, International Socialist Journal, March-April, 1966, p. 188.
82 U.S. News and World Report, January 4, 1965, p. 69.
83 U.S. News and World Report, March 22, 1965, p. 110.
84 Gerassi, op.cit., pp. 365-6.
85 William Lineberry, “Chile’s Struggle on the Left”, New Leader, May 23, 1966, p. 5;
for 1965. New York Times, October 30, 1966; for 1960, p. 311.
86 c.f., Timothy Harding, a study on Latin America, in Studies on the Left, 4:4, Summer,
1965.
87 c.f., Ernst Halperin, Nationalism and Communism in Chile.
88 cited in Petras and Young, op.cit., p. 139.
89 Paul Baran and Paul Sweezy, op.cit., p. 22-23.
90 Statistical Abstract, op.cit., p. 387.
91 Melman, op.cit., p. 95.
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Revolutionary Youth & the New Working Class
92 NYT, December 28, 1966.
93 Fred Cook, and Gene Gleason, “The Shame of N.Y.”, The Nation, October 31, 1959.
94 Perry Anderson, “The Problems of Socialist Strategy” in Anderson,, op.cit., p. 226.
95 c.f., Michel [Bosquet’s?] article in La Nouvelle Observatour, December 31, 1966, p.
15.
96 Karl Marx, German Ideology.
97 Karl Marx, The Critique of the Gotha Program..
Part II - Trends
1 Sidney Fine, The Nature of Automated Jobs and Their Educational and Training Requirements, p. 10.
2 Melman, op.cit., p. 185.
3 J.M. Budish, The Changing Structure of the Working Class, p. 37.
4 Melman, op.cit., p. 186.
5 Statistical Abstract, op.cit., p. 229.
6 Lawrence Lessing, Where the Industries of the 70’s Will Come From”, Fortune, January, 1967, p. 191.
7 Adolph Berle, Power Without Property, p. 45.
8 John Scanlon, “how Much Should a Corporation Earn?”, Harvard Business Review,
January-February, 1967.
9 Kolko, op.cit., p. 54.
10 NYT, January 9, 1967.
11 Bazelton, op.cit., p. 341.
12 Krebs, op.cit.
13 Berle, op.cit., p. 18.
14 Ibid, p. 51.
15 Ibid, p. 51.
16 Kolko, op.cit., p. 66.
17 Bazelton, op.cit., p. 303.
18 Kolko, op.cit., p. 67-68.
19 Andres Shonfield, Modern Capitalism, p. 336.
20 Max Ways, “The Road to 1977”, Fortune, January, 1967, p. 95.
21 Shonfeild, op.cit., p. 336.
22 ––––
23 NYT, January 20, 1967.
24 Peter Worsely, Third World, p. 267.
25 Melman, op.cit., p. 250-3.
26 c.f., Hamza Alavi, “Imperialism Old and New” in The Socialist Register 1964, op.cit.
27 Statistical Abstract, op.cit., p. 229.
28 Magdoff, “Capitalism:, op.cit., p. 76.
29 Ibid., p. 6 and Statistical Abstract, op.cit., p. 107.
30 Statistical Abstract, op.cit., p. 229.
31 NYT, Chart, January 11, 1967.
32 Lessing, op.cit., p. 98.
Part III - Agency
1
2
3
4
5
6
7
Karl Marx, The German Ideology.
Karl Marx, Communist Manifesto.
c.f., Lucion Goldmann, Le Dieu Cache.
Karl Marx, The 18th Brumaire of Louis Napoleon.
Karl Marx, Capital, and the Economic and Philosophical Manuscripts.
Karl Marx, Histoire et Conqeince de Classe.
Karl Marx, The 18th Brumaire of Louis Napoleon.
Lost Writings of SDS
127
8 Gerber, as cited in Ralph Dahrondoff,, Class and Class Conflict in Industrial Society,
p. 117.
9 Dahrendorf, op.cit., pp. 74-5.
10 Ibid.
11 Ibid.
12 Ibid.
13 Berle and Means, op.cit.
14 c.f., section on trends.
15 Dahrendorf, op.cit., p. 87.
16 James Bernham, cited in Dahrendorf, op.cit., p. 80.
17 c.f., Paul Sweezy, The Present As History, chapter on the managerial for a more detailed critique of Bernham’s position.
18 Seymour Lipset and Reinhard Bendixed, Class, Status and Power.
19 c.f., Gorz, op.cit.
20 Daniel Bell, “America’s Un-Marxist Revolution” in Lipset, op.cit., p. 172.
21 C. Wright Mills, The Power Elite, p. 361.
22 John Galbraith, The Affluent Society.
23 Rockefeller Panel Reports, op.cit., pp. [368-9?].
24 C. Wright Mills, People Power and Politics, “The New Left”, p. 259.
25 Statistical Abstract, op.cit., p. 229.
26 Herald Tribune, The U.S. Book of Facts, Statistics and Informaion, p. 249-51.
27 Gorz, op.cit., p. 319.
28 c.f., Budish, op.cit.
29 Gorz, op.cit., p. 319.
Part 4: Praxis
1 Antonio Gramsci, “The Formation of the Intellectuals” in The Modern Prince and
Other Writings, p. 67.
2 Karl Marx, Theses on Feurbach, #1.
3 Henri Lefebvro, La Vie Quotidienne, chapter on praxis.
4 Lyonns survey showed that 48% of the first time demonstrators considered themselves
Liberal Democrats. The next largest group was Democratic Socialist, 17.5%. Conservative Democrats and Liberal Democrats each constituted 10% while Conservative Republicans and Revolutionary Socialist were only 3% each. On the other hand,
among previous demonstrators, 39% were Liberal Democrats, 35% Democratic Socialist and 18% Revolutionary Socialist. c.f., Glen Lyonns “The Police Car Demonstration: A Survey of Participants”, in Seymour Lipset and Sheldon Wolin, ed.s, The
Berkeley Revolt, p. 524.
5 These concepts can be seen in SNCC and ERAP activity and theory, perhaps the only
cogent new left thinking on the issue.